Eliminating the financial close with AI 🎙 Live at Sage Intacct Advantage

"AI changes everything" — that was one of the themes of the Sage Intacct Advantage conference this fall. To discuss what that means for the Intacct product, we're joined by Aaron Harris, CTO of Sage (and one of the founders of Intacct), Brendan Woods, founder and CEO of AutoEntry (recently acquired by Sage), and Dan Miller, VP of Product for Sage Intacct. Listen in to learn about how Sage Intacct is applying AI to build what they call the "Intelligent GL" enabling continuous accounting and perhaps even someday eliminating the financial close.

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Show Notes
  • 01:07 – Meet our guests! 
  • 01:48 – Aaron talks about what's on the horizon for Sage, including the launch of Intelligent GL | Sage 
  • 02:32 – Intelligent GL uses AI to provide continuous trust, and continuous insights that help customers make better business decisions
  • 03:13 – Blasphemy!  How dare you try to take away our close ... Ha! 
  • 05:02 – Brendan shares how AutoEntry will work with Sage to make sure the data is in the right place at the right time
  • 08:33 – Aaron talks about the importance of partnering with other software providers to create a centralized hub for their clients' financial activities
  • 09:57 – Dan talks about the Sage People rollout in 2020
  • 11:37 – You can lead a horse to water, but you can't make it stop loving Excel 
  • 13:28 – After a certain point of growth, Excel's capabilities no longer scale
  • 14:02 – Dan gives some detail on Sage's Visual Explorer 
Connect with Our Guests
Episode Art Photo Credit: 
  • April Blankenship
    • https://twitter.com/aprilblnknshp
    • https://twitter.com/aprilblnknshp/status/1187023281687130112/photo/2
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Transcript

This episode of The Cloud Accounting Podcast is sponsored by Bill.com. As a listener, you've probably heard Blake and I speak about Bill.com on numerous occasions. It feels like they are discussed monthly in either new news or new announcements, but I'm betting there are some things you don't know about Bill.com. Did you know customers use the Bill.com platform to process over $70 billion in payments for the 2019 fiscal year? That they partner with several of the largest U.S. financial institutions, like Bank of America, PNC, and Chase? More than 70 of the top 100 U.S. accounting firms use Bill.com.
 
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Brendan Woods: Well, you can't close, period, without having information, and there's lots of other benefits, I suppose, to automating data entry.
 
Blake Oliver: Welcome [00:01:00] to The Cloud Accounting Podcast. I'm Blake Oliver.
 
David Leary: I'm David Leary.
 
Aaron Harris: I'm Aaron Harris, Sage Group CTO, and one of the original founders of Sage Intacct.
 
Brendan Woods: I'm Brandon Woods. I'm the founder and CEO of AutoEntry; I'm now joined to the team in Sage. 
 
Dan Miller: And I'm Dan Miller. I'm the Vice President of Product for Sage Intacct. 
 
Blake Oliver: We're here live at Intacct Advantage in Las Vegas; MGM Grand, in the rotunda, watching everyone go to all of these sessions. Thank you so much for having us here. It's awesome. [00:01:30] It's amazing what a large conference this has become. This is my third year. So, congratulations to you folks [crosstalk]
 
Aaron Harris: Yeah. Thank you very much.
 
Brendan Woods: Let's just jump in, right? I think a lot of our listeners care about the tech - AI, automation. You have talked about all this stuff. So, what's next for the next 12 months for Intacct? 
 
Aaron Harris: So, yeah, I think the tagline for the conference here is "AI Changes Everything." We see it as a journey where we need to help our customers along the journey with us, as we develop AI capabilities, [00:02:00] and we sort of jointly understand how we're gonna change the industry together. We launched something that we call the 'Intelligent GL,' which essentially uses AI to transform an organization's accounting processes from periodic point in time - mostly focused on the past - processes, to continuous - focused on the future - strategic processes, and we're gonna use AI to make that happen.
 
Blake Oliver: Dan Miller, what does that actually look like when it comes to the product? What are you using AI [00:02:30] to do, or what are your plans in that regard?
 
Dan Miller: Well, we announced several things that we're gonna be doing. As Aaron was talking about, the Intelligent GL is going to allow people to capture information for continuous accounting. They're going to be able to have continuous trust in their accounting system because we're gonna be able to, through AI, be able to provide an audible system all the time and continuous insight, which will help them have predictive capabilities to [00:03:00] look into the future about where their business is going, so they can make better business decisions.
 
Blake Oliver: The thing that really stuck out to me ... There was, I think, one phrase that was uttered a few different times, was that, "We aim to eliminate the financial close."
 
David Leary: It almost got a standing ovation yesterday.
 
Aaron Harris: We've been talking about that for a couple of years. The first time we indicated that we have this very provocative, aspirational objective to eliminate the financial close, it made people uneasy. It's a bit of sacrilege [crosstalk] 
 
Blake Oliver: Yeah, that's our job, right? 
 
Aaron Harris: The close has been [00:03:30] the thing you do your job around for literally centuries. We're not talking decades, or years; for centuries. When you can really help people to understand how the financial close holds organizations back ... The idea that I only have the ability to see how I performed once that close is complete, and I have another opportunity to do it a month later, when I go through that process again, it really is quite antiquated. We absolutely have the technology now to give organizations continuous [00:04:00] visibility into how they're performing.
 
Now, we're being deliberately provocative here. I don't think we're gonna eliminate the close in the next couple of years. But what if we got the close down to something like 10 or 20 minutes, right? Where I'm only within half an hour of having perfect vision into the performance of my organization, as the last ... There are some straggling transactions coming in, and there are some allocations that have to be continuously computed that haven't come along ... It's a directional thing [00:04:30] that we think drives excitement, drives creative thinking within the organization, and gets our customers to see a vision of where we want to take this.
 
Blake Oliver: On that theme, Brendan Woods, you've joined us here from AutoEntry. Our listeners are well aware, I believe, that AutoEntry was recently acquired by Sage. We saw that announcement up on the main stage. What are you up to now, and what can we look forward to when it comes to AutoEntry, and Sage, and Sage [00:05:00] Intacct? Whatever you can share with us ... 
 
Brendan Woods: Yeah, sure. As many of the listeners probably already know, AutoEntry is all about automating data entry into accounting systems. I think it's a perfect fit for working with Sage, as we go forward, because, I suppose, as to what Aaron was saying, working towards continuous close, and continuous audit, even, if we go a step further, in order to do that, you need the data in the system. You can't close, period, [00:05:30] without having the information.
 
There's lots of other benefits, I suppose, to automating data entry, beyond that; things like cash-flow forecasting, and budgeting ... If you don't know how many creditors you've yet to input into the system because bills are sitting in an in-tray on someone's desk, yet to be manually inputted, and so forth. So, there's lots of value.
 
What we've obviously done over the years has built up an independent business, integrating lots of accounting systems and serving CPAs, and accounting, and bookkeeping firms around the world, to streamline their practices and help [00:06:00] them grow; and direct businesses, also. But I always envied the opportunity to work more closely to the GL products. themselves. I think both ourselves and Sage saw a great opportunity to do that across that suite of products that they have.
 
Blake Oliver: Yeah, there's only so much you can do as a third party. Now that you're a part of Sage, I imagine deeper integrations are- and much more is possible in that regard.
 
Brendan Woods: Absolutely. I mean, there are lots of exciting conversations starting about what's possible; the [00:06:30] art of what's possible. That said, it's important also to recognize that we have built up, in the short term, a very significant customer base, over 3,500 accounting, and bookkeeping firms around the world. To serve them and to continue to serve them, we will also obviously support the integrations we have with other products because it is seen as a practice solution for the accounting space; so that they need to think that they can use AutoEntry as a standard operating procedure at the front end of their processes to [00:07:00] standardize how they get data into all of their systems, be it- no matter what their client may be using. But yes, to your point, as regards Sage, it does give us the opportunity to, at least in this particular space, really optimize the integration experience and the user experience, generally, of using automation of data entry with the product, itself.

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David Leary: So, obviously, AutoEntry's now part of the ecosystem. I think, in general, a lot of ERP systems are somewhat closed. Aaron, this is really for you - with Intacct, through the years, it's always been kind of an open ecosystem, and open API. Can you speak to the importance of having [00:08:30] software partners on your journey with you on this? 
 
Aaron Harris: It's absolutely critical. I'd like to point out just this this proliferation, in the modern cloud era, solutions for every conceivable business need. A medium-sized business, today, may use 100 or more cloud applications across their business processes to drive efficiencies and to make as many processes as possible digital. The same company, 15-20 years ago, might have [00:09:00] 10. We not only can't expect to solve all customer problems, it's impractical; it's impossible.
 
But what's unique about being the provider of the financials system of record is that we can then become the hub for all of that activity that's flowing through a company's ecosystem. So, it's to our benefit to be very open, to make sure that we can plug into any source [00:09:30] of economic activity within the business, so that we can capture that down into the financial system of record.
 
Blake Oliver: Lots of product announcements, feature announcements this year. Dan Miller, you were up on stage talking about Sage People and that ... Has that happened yet, that integration, or is that forthcoming?
 
Dan Miller: Is forthcoming?
 
Blake Oliver: Forthcoming. 
 
Dan Miller: The first part of the integration will be happening shortly.
 
Blake Oliver: Got it. 
 
Dan Miller: But we are rolling out, over this 2020 [00:10:00] year, the capabilities from employee-master, synchronization, compensation, time entry will all become part of what we're rolling out. The real focus there is on how we leverage and unify the system information to be able to provide better information for customers, where they have insight into how the combination of what's going on for [00:10:30] their staff, from a financial perspective, can be blended together with what they know about them, from an HR/management perspective, to make better decisions.
 
Blake Oliver: That makes so much sense because so many businesses these days, it's human-capital-driven, and many accounting systems don't even account for that.
 
Dan Miller: No, they don't ... Many accounting systems don't have the ability to bring in additional information. We've been built open from the very beginning - with the idea of our statistical accounts and multi-book accounting - to be able to bring information in that's not [00:11:00] just your pure accounting, but be able to look at that additional information in ways that help you be able to have metrics that give you insight into how your delay in hiring in a particular location is affecting your future ability to achieve revenue objectives.
 
David Leary: One thing that stuck with me yesterday, in your keynotes, was this distance from the source of truth, and almost this attack on Microsoft Excel. [00:11:30] Do we see a future where maybe people won't need Microsoft Excel anymore?
 
Dan Miller: I don't believe that will happen in our lifetime [crosstalk] 
 
Aaron Harris: I've sort of come to peace with the reality that that no matter what we do, people will always love Excel ... You know, spreadsheets are really ... It's elegant and CFOs feel comfortable there. What we have to do with Sage, and Sage Intacct is really make sure that we're encouraging our customers [00:12:00] to put things into accounting and finance that need a little bit more control, where flexibility that you get in a spreadsheet isn't necessarily rewarded.
 
We're also helping them, when they wanna use spreadsheets, to be even more productive than they have been in the past. Yeah, I've come to peace. It took me a long time. I used to get on stage and rant and rave about, "Why are you still using spreadsheets? It's horrible. There's all kinds of things that can [00:12:30] go wrong!" I think Dan got the biggest laugh of the conference-
 
Blake Oliver: I was gonna bring that up - the big screen of #REF and #DIV/0! errors. Everyone loved that.
 
Aaron Harris: Yeah. So, we're gonna continue to remind people of what can go wrong, and horribly wrong, in some cases, but, yeah, I've turned into a realist, as I've gained experience-.
 
Dan Miller: Well, I think that Aaron got it ... What Aaron just said is really right on. I think that Excel has- is great for [00:13:00] low-volume activities, or activities where it is something that is managed by an individual. When you start getting into complex processes you're trying to do at volume, the risk of that breaking is too high to have it be built in a solution that anything you might touch, and it could potentially break the outcome, and give you incorrect information in that process ... 
 
It's totally reasonable for a company to start their budgeting [00:13:30] in Excel, when they're really small, but when they get big enough where they're starting to collaborate across the departments with the finance team, and they want direct input because the input needs to come from the experts, that is no longer a scalable thing to do in Excel. 
 
Blake Oliver: Well, to be fair, that demo or preview of the visual- was it the Visual Explorer?
 
Dan Miller: Yes. 
 
Blake Oliver: Was pretty darned ... Hopefully, people will stop doing their basic pivot [00:14:00] tables and charts in Excel ... 
 
Dan Miller: We were building the Visual Explorer to solve really looking for new ideas, new insights about how they run their business. The fact that you can take a data set, be able to quickly choose a visualization, and then refine, and refine, and refine, helps people think about what's the real question I'm trying to answer? Because a lot of times, there's something we want to know; if we explore a little bit, and you [00:14:30] dig underneath the covers, you learn something that's there that you couldn't have otherwise known if you had to do that by running report, after report, after report. That's missing. That kind of insight really only comes through the exploration, and making the exploration easy is what that's about; building it into the system of record, so it's on your transactional system, makes it available and easily accessible to all of the individuals that have access to the Intacct data, not just the [00:15:00] one person in FP&A.
 
Aaron Harris: If we want people to move from Excel and spreadsheets into this controlled system of record, we've gotta make it easy. Spreadsheets are the original citizen-developer platform. People love it because it gives them flexibility. You don't have to be a developer. You can really do some very creative work, and you become comfortable there.
 
So, if we hope for them to do some of these activities that we really would prefer them to do within our environment, we've gotta create that same experience, [00:15:30] where they feel like a citizen developer, who's very comfortable with the tools. It's very easy to use, and they see the value of doing it there, as opposed to going outside the system, where they don't have the same data trust, and if they don't have the same security that you would otherwise have, you run the risk of corrupting things and causing problems.
 
David Leary: Aaron, how would people get a hold of you if they want to track you down, ask you a question on the socials?
 
Aaron Harris: Well, so, I'm here at the conference, wandering the floors. By all means, if [00:16:00] you see me, grab me. That's a pretty common occurrence here.
 
Blake Oliver: I think that look in Aaron's eyes is ... The idea of getting a thousand feature requests, right? 
 
David Leary: The million podcast listeners we have suddenly reaching out ... 
 
Aaron Harris: Yeah, I've got handlers now that try to protect me. But you can find me on LinkedIn.
 
Blake Oliver: All right, and Brendan, how about you? Brendan Woods? 
 
Brendan Woods: Well, you can find me on LinkedIn, as well. You can find me at Brendan.Woods@autoentry.com, and most likely, very soon, Brendan.Woods@sage.com. [00:16:30]
 
Blake Oliver: And Dan Miller ...
 
Dan Miller: Yeah, you can find me on LinkedIn. It's pretty obvious.
 
Blake Oliver: All right. Sounds great. Thank you all. 
 
Dan Miller: Yep. Thank you. 
 
Brendan Woods: Thank you.  

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