Stay informed with free updates
Simply sign up to the Accounting & Consulting services myFT Digest — delivered directly to your inbox.
Within weeks of Donald Trump’s “liberation day” in April and the ensuing widespread panic after the sweeping escalation of the US president’s trade policy, KPMG had a tariff calculation model ready that it says saved its clients “hundreds of millions of dollars”.
The Big Four firm was “first to market” with the model, according to Stephen Chase, KPMG’s global head of AI and digital innovation, a feat he says would have been impossible without sustained investment in AI technology for over a decade.
Being first to advise has become the new competitive edge for accounting and consulting firms as they push out AI across their businesses, particularly for large legacy firms competing with nimble AI-native start-ups. From trawling mass data sets during audits to find high-risk transactions to drafting consulting documents in minutes, the technology is expected to reorganise how professional services firms work.
Soon after, Chase adds, KPMG snatched an audit bid from the jaws of a rival firm by showing off its AI capabilities to the client. “They were going to go with one of our competitors,” he says.
The rival firm had planned to send the customary “army of people” to manage the major task of transitioning the audit, but KPMG showed the client their AI audit platform, Clara, which the firm says can consume the same volume of information faster, with fewer people. “They went from sceptical to KPMG client,” he adds.
For smaller accounting firms, AI is proving just as helpful. Nearly half of UK firms with turnover up to £500mn reported at least a small rise in productivity from using AI, equivalent to reclaiming almost half a 40-hour week, a study by Xero and the Centre for Economics and Business Research found.
About half of finance and accounting professionals now use AI every day, compared with 33 per cent last year, according to a study by the Wharton School of the University of Pennsylvania published in October.
“The efficiency gains are real, though uneven — as you’d expect with any new technology,” says Dhiren Rawal, managing director and head of global shared services at consultancy Alvarez & Marsal. “In practice, this is what AI adoption looks like: small, practical changes that add up to a genuine shift in how people work. The technology is easy to acquire; the differentiation comes from how well it’s applied.”
Consultants are already using AI to test new scenarios, extract figures and draft complex materials in “minutes rather than hours”, Rawal says. “In transaction advisory, AI tools surface patterns in financial and operational data that would have taken days to uncover manually. In restructuring, they can classify and compare thousands of contracts within hours.”
He added that the biggest impact will come from depth, not scale. “Most firms, including ours, are learning that the hard part isn’t adopting AI, it’s integrating it safely and intelligently into complex workflows. That means tightening data foundations, building clear lines of accountability, and ensuring people understand both the strengths and limits of the tools they use.”
At KPMG, experiments on contained work groups show that AI productivity gains so far tend to range between 10 and 15 per cent, and up to 80 per cent for specific tasks, says Chase.
But for global firms — which mostly operate through separate partnerships operating under a shared brand — the pace of AI adoption varies by country.
“The honest truth is we have member firms . . . where we have an adoption rate of 100 per cent . . . and we have countries where the adoption rate is . . . maybe 70 per cent,” says Christian Stender, global head of AI for tax and legal at KPMG International. “There are differences, maybe also from a cultural perspective.”
Partners tend to use AI less than employees, Chase adds. “I always give my partners a hard time, like ‘you got to lead from the front’,” but “they do different work, so you would expect the usage patterns of an associate to be different than they would be for a partner.”
Aiming for productivity gains alone will not move the needle, says Jonathan Keane, strategy and consulting lead at Accenture for UK, Ireland and Africa. “Gains only come when companies use AI to redesign processes and ultimately rethink whole business domains. That’s where the step-change in efficiency and growth will come from. To get there, the foundations must be right — clean, well-governed data; secure and interoperable systems; and people who understand how to work alongside AI.”
For KPMG’s Chase, the debate has already moved on from productivity. “I think we’ve long since passed the question of are we getting productivity, right? One of the questions everybody wants to know is, are we getting ROI [return on investment] out of it?”
He adds: “We’re all feeling tremendous pressure for ROI delivery . . . This is the year of ROI.”
Read the full article here