Artificial intelligence (AI) has become one of the most talked about innovations in business today. For accountants, auditors, and finance professionals, the discussion usually centers on a single question: Will AI replace us?

The truth is more nuanced. To answer this properly, we can draw on recent work by Erik Brynjolfsson (Stanford Institute for Human-Centered AI), Andrew McAfee (MIT Sloan School of Management), and Michael Jordan (UC Berkeley), who wrote extensively on the tension between automation and collaboration in AI. Their insights, first published in The Atlantic (2024), are deeply relevant to our profession.

Automation vs. Collaboration

Brynjolfsson, McAfee, and Jordan distinguish between two types of tools:

• Automation tools are designed to take over tasks completely. In accounting, these include automated bank feeds, payroll submissions to SARS, or invoice Optical Character Recognition (OCR) extraction. They save time and cut costs, but if they fail, human expertise must step in as the safety net.
• Collaboration tools enhance human capability but still require professional judgment. Financial dashboards, forecasting models, and audit analytics fall into this category. They don’t replace accountants, they amplify our insight.

The authors warn that poorly designed automation doesn’t just fall short; it can actively undermine expertise by encouraging over reliance.

Lessons from Aviation

The article highlights the 2009 Air France 447 disaster, where over-reliance on autopilot (automation) left pilots unprepared when the system disengaged. Human expertise had eroded from disuse.

This resonates with accounting: if professionals outsource too much to “black box” automation, we risk losing the sharpness of professional skepticism, the very skill that protects clients and businesses.

A Story From the Workshop Floor

We’ve seen similar dynamics outside of accounting too. Take modern car repairs.

When you take your car to a dealership today, technicians often rely on a diagnostic machine that plugs into the vehicle’s computer box. But if the computer box itself is faulty, the diagnostic tool can’t provide a clear answer.

I once had a a vehicle with ECU issues. At the dealer, I was told they “suspected” the ECU was the problem, but they couldn’t be sure. They wanted me to authorize a replacement, at the time, a R20,000 part, just to find out whether that was the real issue.

By contrast, seasoned mechanics who trained before diagnostic machines became standard could listen to the engine revs, feel the idle, and tell you almost immediately what was wrong. Their expertise filled the gaps that automation could not.

That experience confirmed something we also see in finance: we are not going to live in a world where AI fully automates expert judgment. Instead, AI will be used to enhance the decisions of experts.

AI in Accounting Today

AI is already embedded in many accounting processes:

• Automated reconciliations.
• Expense categorization.
• Payroll and tax submissions.

But its real promise lies in collaboration, just as Brynjolfsson and colleagues argue. AI can:

• Surface anomalies in audit data.
• Identify unusual tax positions across thousands of returns.
• Strengthen advisory by comparing financial patterns across industries.
• Power predictive cash flow models and valuations.

Take the impairment model as an example. It involves judgment because every debtor’s situation is different. If AI is fed incomplete or incorrect data, it could generate misleading impairment ratios, leading a lender to make poor decisions. Only human accountants can apply judgment, context, and ethical reasoning to interpret such results.

 The Power of Human + AI Complementarity

As the authors show in medical studies, doctors with AI outperform both AI alone and doctors alone. The same applies to accounting: an AI may flag anomalies, but it takes a Chartered Accountant to judge if it’s fraud, error, or legitimate complexity.

Risks of Over-Automation

The article cautions against automation hubris, the belief that AI can seamlessly take over expert work. For accountants, this risk includes:

1. Skill erosion – junior staff lose training if AI handles foundational work.
2. Overreliance – novices treat AI outputs as gospel.
3. Loss of judgment – critical thinking weakens if accountants accept black-box answers uncritically.

Designing for Collaboration

As Brynjolfsson, McAfee, and Jordan conclude, collaboration is often more valuable than premature automation. For accountants, this means:

• Automating the routine: reconciliations, data entry, compliance.
• Collaborating on the complex: tax planning, audit, valuations, advisory.
• Maintaining training pathways so the next generation of accountants can still grow expertise.
• Staying critical of AI outputs, never outsourcing judgment.

Conclusion: Man and Machine

The key insight from Brynjolfsson, McAfee, and Jordan is clear: AI should not be framed only as a replacement. It must be designed to collaborate with experts, not just automate them away.

For accounting, this means AI should free us from repetitive tasks while sharpening, not eroding, our expertise. The future of accounting is not AI versus accountants, but accountants who know when to automate and when to collaborate.

At Qount Accounting, we believe that is the future worth building.

📖 Reference: Brynjolfsson, E., McAfee, A., & Jordan, M. (2024). When Experts Collaborate, They Communicate. The Atlantic.

#Accounting #AI #FutureOfWork #Automation #Collaboration #QountAccounting

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In August 2025, South Africa’s National Treasury released the Draft Taxation Laws Amendment Bill (TLAB) 2025, which proposes significant changes to the Value-Added Tax (VAT) treatment of schools registered under the South African Schools Act. If enacted, these amendments would take effect from 1 January 2026.

The proposals aim to align the law with the policy intention that basic education be excluded from the VAT net. However, they raise serious financial, procedural, and equity concerns, particularly for independent (private) schools. Below is a detailed look at what is proposed, its potential effects, and the reactions from stakeholders.

 What’s Proposed

• Extension of the VAT Exemption

The draft bill seeks to exempt all goods and services supplied by a school registered under the South African Schools Act, regardless of whether they are supplied in return for school fees or not.

Currently, exemption (per section 12(h)(ii) of the VAT Act) applies only when goods or services are supplied for consideration in the form of school fees, lodging, or board/boarding, and only if those supplies are “necessary for”, “subordinate to”, and “incidental to” educational services. If goods/services are supplied outside those forms or outside those conditions, they are often standard-rated.

• Deregistration of VAT Vendors

Independent schools currently registered as VAT vendors, because they engage in taxable supply of goods or services (e.g., hall rentals, uniform sales, facilities hire), would be required to deregister under the new proposals. 

• Deemed Supply / Exit VAT Liability

When a school ceases to be a VAT vendor (deregistration), under current law (section 8(2) of the VAT Act), it is as if the school has made a “deemed supply” of all assets used in its business e.g., buildings, equipment, at their open market value (or cost, whichever is lower). This triggers an output VAT liability as of the date of cessation. In this case, the expected effective date for deregistration is 31 December 2025.

• Transitional Relief / Payment Arrangements

To ease the burden of the exit VAT, Treasury proposes introducing a new section 8(2H) allowing schools to pay the liability in 12 equal monthly instalments (or more, as permitted by SARS).

Also, new time of supply rules under a proposed section 9(14) would adjust when output tax is deemed to arise, linked to when each instalment becomes due or is paid, to avoid penalties or interest accumulating unfairly.

• No Refunds for Past VAT Charges

The draft includes a new section 40E, which aims to ensure that past VAT assessments that have been finalised before 1 January 2026 cannot be reopened for refunds (even if VAT was charged on taxable supplies under prior legislation). Unfinalised assessments may be reviewed, but no new assessments may be issued.

Potential Impacts & Concerns

Financial Liability / Cash Flow Shock

• Independent schools that have significant VAT vendor activities stand to face large financial liabilities due to the deemed supply of assets. These could run into millions of rands.
• Although instalments are proposed, many schools will have already set their budgets for 2026, so this is an unplanned cost. Turf, halls, equipment all these may now trigger VAT that schools had not budgeted for.

Increased Costs Passed to Parents

• For many independent schools, revenue from taxable activities (uniforms, facilities hire, tuck shops, sports fields rented out, etc.) subsidises or offsets operational costs. Losing the ability to claim input VAT, coupled with exit VAT liability, could force schools to raise fees or cut services.
• Impact on Infrastructure & Investment
• The exit VAT could discourage future investment in infrastructure because schools will now factor in large VAT related liabilities for any significant capital expenditure.

Legal and Administrative Uncertainty

• Some of the current wording in the law (e.g. “registered or conditionally registered”, references to old Acts) is being updated for clarity. The amendments attempt to correct obsolete references (e.g. Further Education and Training Colleges Act being renamed) and to clarify which institutions count.
• There is concern about the timing (1 January 2026) giving schools little time to plan. And the fact that past VAT charges (on taxable supplies) won’t be refunded adds to the burden.

Arguments in Favour

• Consistency with Policy Intent: National Treasury argues that education was always intended to be excluded from the VAT net. The changes seek to bring law in line with that policy.
• Simplicity and Clarity: Removing ambiguous terms and expanding exemptions reduces the boundary between what is taxable vs exempt, reducing grey areas and administrative burdens of deciding whether a school’s particular supply is taxable.
• Equity / Access: By reducing the tax burden on goods and services connected with education, government can argue it helps keep schooling more affordable though there is debate whether that benefit would actually flow to end users (parents / pupils).

Stakeholder Reactions

• The Independent Schools Association of Southern Africa (ISASA) has strongly objected, warning of fee increases, budget cuts, and lowered quality of education.
• Free SA, a civil rights non‐profit, described the change as “extraordinary,” pointing out that forcing deregistration will trigger VAT liabilities that schools might struggle to meet.
• Some school groups are calling for delay or transitional relief beyond what has been proposed, to allow schools to adjust.

Open Questions / Risks

1. Will these cost savings actually reach parents? Even though schools will no longer collect VAT on many supplies, the exit costs and loss of input VAT claims may offset any savings, or even make operating more expensive.
2. Differing Impact among Schools Smaller schools with fewer taxable activities may be less affected. Larger independent schools with substantial commercial type operations (rental, sports facilities, etc.) are more exposed.
3. Impact on Public vs Private Sector The shift may push more families towards public schools if private schools increase fees. This could increase pressure on the public system.
4. Implementation and Compliance How SARS will determine asset values for deemed supplies, how instalment payments will be applied, how appeals or disputes will work all these need clear regulation and guidelines.
5. Timing The deadline (1 January 2026) might leave little time for schools to prepare. There may be calls to postpone implementation to allow better planning. 

The proposed amendments in the Draft Taxation Laws Amendment Bill 2025 represent a major shift in how independent schools in South Africa are treated under VAT law. On one hand, they promise clarity, alignment with policy, and potentially reduced VAT based tax compliance burdens. On the other, they carry serious financial implications for many schools, parents, and the broader education system.

Because of these stakes, stakeholder engagement during the public comment period is going to be critical. Schools, associations, parents, and civil society should carefully scrutinise the proposals, quantify the potential costs and savings, and advocate for safeguards (such as delayed implementation or further transitional measures) where needed.

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In today’s fast-changing business environment, waiting until year-end to understand your financial performance is simply too late. Many small and medium-sized businesses fail to make timely decisions, not because they lack the drive, but because they lack management accounts: monthly reports that turn financial data into actionable insights.

What Are Management Accounts?

Management accounts are internal financial reports prepared on a monthly or quarterly basis to help business owners and managers track performance, control costs, and make informed decisions. They go beyond compliance, focusing on profitability, cash flow, and operational trends.

Where annual financial statements tell you what happened, management accounts tell you what’s happening right now, and what you can still change.

Case Study: How Management Accounts Exposed Hidden Wastage and Improved Control

One of our catering services clients was recording higher purchases each month, even though income remained relatively stable. Initially, this didn’t raise alarm because business activity appeared normal. However, when Qount Accounting prepared their monthly management accounts, the data told a different story, purchases had risen by over 20%, while revenue hadn’t moved. The result was a sharp decline in gross profit margins, increase in overdraft usage.

A deeper review revealed the cause: staff were not dishing up the correct meal portions, particularly during the night shift when there was less supervision. The team feared being scolded by the client night shift employees for dishing up small portions, so they served larger portions to “play it safe.”

During our monthly management accounts presentation meeting, we advised the client later introduced tighter controls, including locking up raw materials (ingredients) and allocating enough to feed the average night-shift traffic, food started running out before shift end even the number of their clients employees was the same . That’s when it became clear the problem wasn’t demand, but portion sizes.

In response, the business implemented stricter stock control measures, trained staff on standard portioning, and added a night-shift supervisor to monitor distribution.

By the following month, the management accounts confirmed the improvements, purchases had normalized, margins recovered, and the business achieved greater consistency in its cost ratios, we just presented the September 2025 Management accounts and the business is back to profitability the purchases are marginally up together with sales volumes which is what is expected.

Without management accounts, this issue would have gone unnoticed until the year-end financials, when it would have been far too late to correct or when.

Cash Flow and VAT Planning: Another Hidden Benefit

Management accounts also play a critical role in cash flow planning, especially when it comes to VAT. By tracking revenue, purchases, and VAT liabilities month by month, businesses can budget ahead for their VAT payments rather than being caught off guard at filing period.

Many small businesses mistakenly believe they are “paying too much VAT,” when in reality they are merely acting as collection agents for SARS, collecting VAT on behalf of the government and remitting it later. Without management accounts, owners often spend VAT funds unknowingly, leading to serious cash flow problems when the VAT becomes due.

Through regular management reporting, we help clients track the VAT accumulating each month, ensuring they ring-fence those funds and maintain sufficient liquidity when filing deadlines arrive. This has saved several clients from penalties, interest charges, and unnecessary financial strain.

Why Every Business Needs Management Accounts

1. Early Problem Detection Identify inefficiencies like wastage, over-purchasing, or declining margins before they escalate.
2. Informed Decision-Making Make operational adjustments using up-to-date financial data — not last year’s figures.
3. Cash Flow & VAT Planning Predict upcoming VAT obligations and manage cash flows more effectively.
4. Performance Tracking Spot trends, compare results, and measure progress monthly.
5. Accountability & Transparency Strengthen trust with staff, investors, and lenders through consistent financial visibility.

The Result: Control, Consistency, and Confidence

Since introducing regular management accounts, our client’s cost containment strategy has taken full effect. Purchases are aligned with revenue, wastage is under control, and VAT budgeting is far more accurate. The business now operates confidently, knowing that decisions are backed by accurate, timely information.

Final Thought

At Qount Accounting, we’ve seen time and again that businesses that measure monthly perform better annually. Management accounts are not a luxury, they’re an essential tool for growth, control, and sustainability.

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