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Future of Accounting

Why the Most Profitable Accounting Firms of the Future Might Have No Employees at All

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One guy. Zero employees. He spends 70% of his budget on technology.

Sam Leon runs The Millennial CPA in Richmond, Virginia, where AI does most of the tax prep work while he reviews and signs off. He just landed on Accounting Today’s 2026 Best Firms for Technology list, not by building a bigger team, but by proving you don’t need one at all.

Meanwhile, KPMG is shutting down its entire federal government audit practice after losing a $60 million Pentagon contract. They’re reassigning 450 employees and cutting another 400 from advisory. The old work is shrinking. The new AI, cyber, and forensics work is growing fast.

On this week’s episode of The Accounting Podcast, hosts Blake Oliver and David Leary discussed what these stories mean for the profession. They explored how AI is making the “firm of one” model possible, tested the new QuickBooks and Xero connections to Claude, and wrestled with a big question: If AI can replace so much labor, what happens to the people and the economy that depend on them?

 

The Solo Practitioner Who Turned AI Into His Staff

Sam Leon took a simple but radical approach to building his firm. AI handles the grunt work of tax return preparation, including creating workpapers, doing year-over-year comparisons, and mapping QuickBooks data to tax forms. He reviews everything and signs the returns. That’s it.

“I see AI as coming together to be a total tax preparer, and whoever signs the returns is the reviewer,” Sam told Accounting Today. He thinks of the AI as his junior preparer while he’s the senior reviewer.

The time savings are wild. Work that would take a human three to five hours, such as creating detailed tax workpapers from QuickBooks exports, takes AI five minutes. And Sam has no plans to hire. “I won’t hire until I hit a wall with my AI preparers and AI workflow managers,” he said.

Blake validated this approach based on his own daily use of Claude Cowork. “To do it as an individual is totally possible,” Blake said. “And so I expect we’ll see more of these firms of one, and you’ll be able to scale up and make a lot of money, because you don’t have to hire employees.”

David connected this to a broader trend he calls the “minimum viable-sized company.” The old playbook was simple: raise money, hire people, grow. “You don’t need that anymore,” David said. “The future winners are going to be small, highly efficient teams with strong strategic clarity. Not large organizations.”

Of course, there are questions. How much revenue does Sam actually make? How does he handle client communication and invoicing? Is he a software engineer or just really good at prompting AI? Blake and David want to get him on the show to find out.

The Tools Are Getting Easier, But Still Have Limits

Right now, Sam’s model works because he’s willing to configure AI tools himself. But that’s changing fast as AI gets built directly into the software firms already use.

Canopy just launched an AI “Coworker” feature across its practice management platform. David was initially skeptical when he saw the sample prompts, which included things like “list all my clients,” that you could see with one click anyway. But Blake highlighted the real value: scope-creep detection that analyzes your billing and emails to spot when you’re doing more work than you’re charging for, automatic workflow updates when disaster declarations change filing deadlines, and meeting notes that automatically create tasks with assignees and due dates.

“These AI agents in practice management are going to be hugely important,” Blake said. “They’re going to make practice management ten times more valuable.”

The big platforms are also opening up to AI. Intuit just released connectors linking Claude to QuickBooks, TurboTax, Mailchimp, and Credit Karma. Xero has one too. But Blake tested both and found them pretty limited. You can pull basic reports and import transactions, but you can’t actually analyze transaction-level data yet.

“If they don’t make connectors more robust, they’re kind of useless,” Blake said. Still, the direction is clear. As David put it, “Claude becomes like your central gear that’s spinning data out to these other spots.”

KPMG’s Federal Exit Shows Where the Profession Is Heading

While solo practitioners are using AI to do more with less, KPMG is learning what happens when you can’t adapt fast enough.

The firm just lost its contract to audit the U.S. Army. It was a $60 million annual deal they’d had for over a decade. The Army has never passed an audit, and now the Pentagon wants to restructure the whole approach. KPMG responded by shutting down the entire federal audit practice and reassigning 450 people.

But that’s not all. They’re also cutting 4% of U.S. advisory staff, or about 400 people, mostly in regulatory risk and financial services consulting. These cuts continue a pattern that started in 2023.

Instead, KPMG is investing in AI, cyber, forensic services, and managed services. Traditional audit work is shrinking, while tech-enabled services are growing.

The Big Risk 

If companies use AI mainly to eliminate jobs, who’s going to buy their products?

Christine Kuglin and Bright Ikwetie wrote about this in Accounting Today, calling it the “AI efficiency paradox.” Businesses get more efficient by replacing workers with AI, but they’re also eliminating the incomes that drive consumer spending. It’s a potential death spiral. Less spending means less revenue, more layoffs, and more AI. Rinse and repeat.

The economic data is confusing. Weekly jobless claims just hit 189,000, the lowest in more than five decades. Yet manufacturing employment is down 88,000 jobs year over year. How can unemployment be so low when we keep hearing about layoffs?

“Is this just lagging?” Blake wondered. “Are these workers just finding jobs in other parts of the economy or maybe working for themselves?”

For accounting specifically, the demand for talent remains strong. Intuit analyzed LinkedIn data and found that both tax and accounting roles are “very hard to hire” nationally. They’re actively recruiting with flexible, remote-first benefits, which is exactly what the Big Four firms are cutting.

What This Means for Your Firm

The lesson from Sam is that one person can now deliver what used to require a team. The same principle scales up. A small firm can compete with a large one, and a mid-size firm can offer enterprise-level services.

But don’t use AI just to do the same work with fewer people. Use it to do work you couldn’t do before. As Blake put it, “The growth opportunity in accounting is advisory-type services. And AI paired with expert humans is just so incredibly powerful for doing advisory work like fractional CFO services, M&A advisory, and cost segregation studies.”

David sees another opportunity in helping clients “vibe code” custom apps instead of stacking expensive SaaS subscriptions. “I am confident that accountants could vibe code,” he said. “The old stack of app stacking is going to go away. You’re just going to help your client build the app they need.”

The tools are here. The demand is there. The question is whether firms will use AI to shrink or to grow. Firms that use AI to expand what’s possible rather than just cut costs will set the terms for everyone else.

Want to hear Blake test the QuickBooks-Claude connector live? Curious about how much Sam actually makes? Listen to the full episode of The Accounting Podcast for all the details, plus discussions on new IRS whistleblower rules, tariff refund lawsuits, and why procrastinating on AI adoption might actually pay off.

The Billable Hour Is Broken and Every Firm Leader Knows It. So Why Won’t Anyone Kill It?

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Richard Lynch can list every reason the billable hour is broken. It undervalues experienced professionals, creates perverse incentives, burns people out, and reduces human beings to time-tracked units. But without a hint of irony, he admits that Sikich, one of the largest CPA firms in the country, still tracks hours “on a religious basis.”

That contradiction tells you everything about where the accounting profession stands right now.

On a recent episode of the Earmark Podcast, host Blake Oliver sat down with Richard, a managing principal at Sikich with over 25 years in public accounting. They had an honest conversation about where things actually stand. Not where the conference keynotes say they stand or where vendor demos suggest they stand, but where they actually stand inside accounting and advisory firms, at the level where someone still has to fill out a timesheet at 9 p.m. on a Tuesday.

The takeaway is that the profession’s transformation is stalling because firms can’t let go of the operational scaffolding they’ve built around the billable hour.

The Super Accountant Vision

Richard has a term for what’s coming: the “super accountant.” It sounds like marketing language, but his definition is specific. A super accountant has AI fluency, strong judgment, and understands compliance without needing to physically perform it. “They’re not a tech person doing accounting work,” Richard explains. “They are a technical person, maybe a CPA, that specifically knows how to leverage technology.”

The structural change everyone talks about is the pyramid becoming a diamond with fewer people at the entry level and more in the middle. But Richard makes an important distinction. The bottom rung is moving up in capability, not disappearing. Future CPAs will “reach a higher level of intellect, capability, and advisory skills at a much earlier age without decreasing the standards.”

Richard points to how this has happened before. Thirty or forty years ago, interns got coffee and made copies. Today, interns do actual client work. “The capability of interns moved up,” he says. The same shift is about to happen again, just bigger.

But the education system isn’t ready. Accounting programs are mostly theoretical. They “lay a foundation,” Richard says, but “certainly don’t give you anything that is pretty or accessible to a client.” Firms will have to bridge the gap with intensive training, it may look like six to eight months where new hires don’t touch billable work, just learn the craft.

The Review Problem

Blake raises the concern many accountants have voiced. If AI does all the basic work, how do people learn to review? The whole system depends on doing the work first, making mistakes, getting feedback, and building judgment.

Richard doesn’t dismiss this. He calls it “a real concern” and says you “can’t underestimate or understate the value of experience.” But then he reframes it with an analogy.

Try explaining to kids today why they need to know how to use an encyclopedia. It seems absurd. The skill became irrelevant because the tool changed. What replaced it was arguably harder: filtering reliable information from unreliable information online.

The same thing is happening with review. “Technology will take care of putting it in the proper box,” Richard says. “Your objective is to have the filter of understanding how to interpret the outcome.” And he goes further: “There may be a benefit to actually not having that anchor of how we used to do business.”

This isn’t theoretical. Tax GPT claims it fully automated 1040 preparation. Basis says it’s done the same for partnership returns. Richard has talked to both vendors. The pace of accuracy improvement is “impressive.” AI is rapidly getting to where it’s “right more than it’s wrong.”

But Richard draws an important distinction. Completing a tax return is just compliance. The real product is what happens after: the advice on paying less tax, structuring a business sale, or planning succession. “When you engage with your clients beyond delivering compliance services,” Richard notes, “fees don’t really come up.”

Why the Billable Hour Won’t Die

“Our people hate entering their time,” Richard says plainly. “There’s no value to the time they spend entering their time and it undervalues us.” Experienced professionals solve complex problems in an hour because they have 30 years of experience. Bill that as one hour, and you’re “undervaluing the 30 years of experience that allowed you to answer that question.”

Richard calls abandoning timesheets “the Mount Everest” of firm transformation. The billable hour is the operating system. Everything runs on it, including utilization, productivity, margin, capacity planning, performance evaluation, even work-life balance monitoring. “You can’t really erase billable hours without erasing all of it,” he says.

Then Richard makes an argument Blake hadn’t considered before. Timesheets might actually help prevent burnout. Sikich monitors employees running over their expected hours and treats it as a capacity problem. Without those guardrails, Richard argues, ambitious people “will work so hard, they’ll burn themselves out really quickly.”

But Blake zeros in on the real issue. AI has destroyed the link between time and value. If AI makes your team twice as fast, the client pays half as much under hourly billing. That math doesn’t work anymore.

So what replaces hours? “We haven’t necessarily identified a better alternative,” Richard admits. Accountants like data and hours provide lots of data. Any replacement becomes more subjective. Client satisfaction? Value delivered? Team engagement? These are harder to measure, and for a profession built on measurement, that’s a problem.

The Basketball Team Problem

Richard draws on his sports background to explain what might work better. Think about the 1990s Chicago Bulls. Michael Jordan and Scottie Pippen scored the points. But Dennis Rodman, the defensive specialist who didn’t score much, was essential. His contribution didn’t show up in the headline stats, but the team needed him.

“We’re not even looking at points. We are looking at time on the court.” Blake points out. The profession measures the wrong thing entirely.

But Richard warns that team models only work if everyone performs. If Rodman doesn’t hustle for rebounds while Pippen is scoring, or if Pippen takes a game off while Rodman is sacrificing his body, the whole thing falls apart. “You have to have a culture where the team performs within kind of a standard deviation of each other.”

The deeper problem is cultural. “The connotation of the employee becomes, I am an hours-based person. All I am is hours,” Richard says. When every review, promotion, or conversation starts with “how many hours did you work,” people internalize that their value is their time. Not their judgment or ideas.

And the system treats every hour as equal, which Richard calls “baseline, categorically false.” Some people think faster. That doesn’t make them more valuable, but under an hours system, it makes them look more productive.

The Implementation Gap

Richard says people actually don’t burn out from long hours. “I don’t hear complaints about the hours when it’s engaging work,” he says. He says his team gets excited working a long weekend for a complex client issue. The burnout comes from being stuck at 9 p.m. “dealing with software issues and plugging numbers into spreadsheets.”

AI can eliminate that burnout-causing work. But only if firms actually let it.

“We’re playing with it, but we’re not really implementing it,” Richard says. “We’re purchasing it, but we’re not really relying on it.” Firms pour billions into AI tools, but their training, career paths, and daily operations haven’t changed. The technology is there but the willingness to break old processes isn’t.

“There will be progression and there will be extinction. The question is at what pace,” Richard says, framing the stakes clearly.

Working harder won’t compensate for failure to adopt anymore. Buying AI products doesn’t mean you’re adopting AI. And trying to fit AI into existing processes instead of letting it break them is a choice with consequences.

“If you consistently try to find a place of complacency and comfort, you will not adopt at the pace necessary,” Richard warns.

The Choice Firms Are Making Right Now

What makes this conversation valuable is Richard’s willingness to acknowledge he doesn’t have all the answers. “I still have a lot to learn,” he says.

He can see the billable hour is broken and the pyramid is unsustainable. He can see buying AI tools without changing operations is theater. And Sikich is still tracking hours religiously.

That honesty tells you where the real work is. The super accountant future requires dismantling training models, educational assumptions, and measurement systems that have existed for decades. Not just purchasing new software.

For accounting professionals at every level, including partners making decisions, managers caught between old metrics and new realities, or someone early in their career wondering what’s ahead, the question is whether the firm will let AI change your work.

Richard has a message for other firm leaders: “Don’t let fear rule the day.” The firms that use AI as permission to break outdated processes will thrive. The firms that bolt AI onto unchanged operations will struggle. And that divergence is accelerating.

“I have every desire to be on the side of progression,” Richard says. Which side is your firm choosing?

Listen to the full conversation between Blake and Richard on the Earmark Podcast for deeper discussion on replacement metrics for the billable hour, building the super accountant pipeline, and why letting go of the past might be the profession’s biggest challenge. Then visit earmark.app to earn free NASBA-approved CPE credit.

When Tax Day Was Party Night at the Post Office — And Why AI Is About to Upend Everything Else About Accounting

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Before tax e-filing took over, April 15th was a public spectacle at American post offices. As Blake Oliver and David Leary discussed on their Tax Day episode of The Accounting Podcast, crowds would gather until midnight, with live entertainment, giveaways, and even Playboy offering “stress relief massages” in pink booths. In Philadelphia, there was a “dunk the IRS agent” booth for charity. Radio stations broadcast live. Fast food chains handed out samples. It was America’s weirdest annual party.

Those days are gone — 94% of returns are now filed electronically. But as the hosts explored in this wide-ranging episode, the accounting profession faces disruptions far more profound than the shift from paper to pixels. Within three years, KPMG expects routine audit testing to have “next to no human beings” doing the work. Hobbyist developers are cloning QuickBooks with AI over a weekend. And a third of workers aren’t even checking AI outputs before they submit them.

The IRS Can’t Keep Up — With Rules or Technology

The profession’s struggles with rapid change start at the top. Just five days before the filing deadline, the IRS finalized which jobs qualify for the new no-tax-on-tips deduction. Podcasters made the cut (Oliver and Leary were pleased), along with tattoo artists, ice sculptors, and golf caddies. Accountants didn’t.

“Five days after they finalized these rules to implement them for our clients,” Oliver noted with frustration. The deduction allows eligible workers to exclude up to $25,000 in tips from taxable income, but mandatory service charges don’t count. “This could be the death of the automatic gratuity,” Leary speculated, since those forced tips won’t qualify.

Meanwhile, Americans are spending 11.6 billion hours completing federal compliance forms — mostly tax returns. The value of that labor? Over half a trillion dollars. “That’s material,” Oliver said, noting it represents a significant chunk of the economy devoted to paperwork.

The IRS’s own modernization efforts tell a cautionary tale. The agency had 126 AI projects running as of last summer, up from just 10 in 2022. But after losing 25% of its workforce, 61% of those projects remain unfinished with no plan to close the skills gap. Even more puzzling: the IRS killed its Direct File program despite it costing only $16 million instead of the estimated $61 million and growing 78% year-over-year. “The program was gaining traction and was less expensive than they thought it was going to be, and yet it got canceled anyway,” Oliver observed.

The Big Four’s Radical Restructuring

While the IRS struggles with basic modernization, the Big Four are racing ahead with AI automation that could eliminate thousands of jobs and upend the billable hour model that has defined the profession for decades.

KPMG is moving fastest. They’re piloting AI systems this summer and deploying them next year for routine testing of transactions like payroll, receivables, and cost of goods sold. “Within 2 or 3 years, routine testing could become the first major audit area with effectively no human audit team directly doing the work,” Oliver quoted from KPMG’s audit chief digital officer. “Next to no human beings.”

The other firms aren’t far behind. PwC’s evidence-matching tool now processes 30 client document types, up from six months ago. EY is testing something even more futuristic: AI audit agents that talk directly to client AI agents to gather documents and prepare workpapers. Only Deloitte is publicly pumping the brakes, emphasizing AI should “augment not replace” human auditors.

The numbers are stark: Big Four leaders expect 20-30% of a typical audit to be fully automated by 2029. KPMG UK is already cutting 440 audit jobs. “I don’t see any other outcome than the Big Four just cutting massive numbers of staff jobs,” Oliver said. “If they do this right… that’s 20 to 30% of their billable hours. What are they going to do? Just raise their rates 20 to 30% to compensate?”

Leary had the line of the episode: “Agents are the perfect accounting firm employees. The partners are going to love them.”

The traditional career path is crumbling too. EY’s talent chief told Business Insider that linear career models are becoming “less relevant” as AI values skills over tenure. Oliver speculated firms might shift from hiring masses of new graduates to recruiting experienced professionals from industry, or moving to an apprenticeship model with smaller, more intensively trained classes.

Everyone’s Building Their Own QuickBooks Now

The disruption isn’t just coming from the top. A Reddit user built a full accounting system that runs inside Claude Desktop — no interface, just chat. You tell Claude what happened, and it updates your books. Another developer cloned QuickBooks Desktop using AI, creating a free open-source alternative. The motivation? “I didn’t want to pay for QBO.”

“You as an accounting firm had control over your tech stack and your clients’ tech stack,” Leary explained. “We’re a Xero shop or a QuickBooks shop… Now your clients are just building their own stuff. How do you as a firm manage this now?”

Oliver’s prediction, based on every past tech revolution: “We will end up with more work rather than less, because it will enable our clients to do way more accounting stuff that we’ll have to clean up.”

On the funded startup side, Juno raised $12 million to build AI tax prep that automates 90% of data entry while keeping CPAs in the loop. The key: transparency over autonomy, with source-to-return traceability and visual validation tools. Artifact launched Omni, which Leary called “a Zapier for accounting firms” — it trains AI agents to use your existing tech stack rather than replacing it.

Meanwhile, legacy players are scrambling. Xero published a blog post claiming to be an “AI native operating system.” Leary counted over 20 buzzwords and read them aloud in a devastating list: “AI native, intelligent SaaS, autonomous finance, system of action…” His verdict: “I don’t think this is written for customers. I think this article is written for the street in an attempt to move the stock price.”

The Quality Crisis Nobody’s Talking About

Here’s what should terrify every firm leader: 35% of workers rarely or only occasionally review AI output before submitting it, according to a Resume Now survey. Eighteen percent trust it straight out of the box. Only 40% review AI output every single time. And 15% use AI at work secretly without telling their manager.

“That should scare you as an accounting firm owner,” Leary said.

Oliver argued firms need systems with built-in controls: “If an employee is just generating something with AI… and they didn’t change anything or they didn’t spend any time looking at it, then flag that.”

The stakes are real. The episode covered two fraud cases that show what happens with weak oversight. A New Jersey preparer filed over 100 false returns seeking $170 million in pandemic credits, getting $55 million before being caught. A Pennsylvania preparer started a new $5.5 million fraud scheme while still on supervised release from a previous conviction.

What Separates Winners from Losers

A Hinge Marketing study of 133 firms revealed a massive performance gap emerging. High-growth firms are growing at 33% annually versus 9.6% for average firms. The difference? High-growth firms spend 9% of revenue on marketing (versus 5% for others), and over 90% use AI for content creation, automation, and research.

“If you have a firm that’s growing at 10% and you want it to grow at 30%, spend 10% of your revenue on marketing,” Leary summarized, though Oliver questioned whether it’s causation or correlation: “Is it just that the firms that are growing really fast have money to burn on marketing?”

The Reckoning Is Here

The accounting profession has always adapted slowly. As Leary noted, “Just ask Xero how it takes decades for them to barely make a scratch into the QuickBooks world.” But this time feels different. The changes are coming from every direction at once — Big Four automation, bedroom coders, funded startups, and clients building their own systems.

The irony is thick. Even as AI promises to make location irrelevant, EY is requiring US tax staff to work in-office 12 days a month. The IRS has 126 AI projects but can’t finish them. Firms are adopting AI while a third of workers don’t even review its output.

For firms willing to invest, experiment, and build proper controls, the opportunity is massive. For those hoping to wait it out, the message from this episode is clear: the profession that gathered at post offices until midnight to file paper returns is gone. The question isn’t whether AI will transform accounting — it’s whether the profession can maintain its core promise of trustworthiness while everything else changes around it.

To hear the full discussion — including the story of a disgruntled worker who burned down a $500 million Kimberly-Clark warehouse over pay disputes — listen to the complete episode of The Accounting Podcast.

Which Accounting Firms Have the Happiest Employees? And Does It Even Matter Anymore?

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In episode 475 of The Accounting Podcast, hosts Blake Oliver and David Leary welcomed Dominic “Dom” Piscopo, CPA, from Big 4 Transparency to discuss his annual rankings of the best and worst accounting firms. What started as a conversation about job satisfaction and hours worked quickly evolved into a discussion on how AI startups might systematically dismantle the entire professional services industry.

The timing couldn’t be more striking. While Dom shared data showing Andersen topping the charts for employee satisfaction despite the stress of IPO readiness, the hosts were grappling with a different set of numbers. Intuit’s stock fell 33% in just 30 days, wiping out $110 billion in market value. Xero is down 22%. When an AI tax planning app called Hazel debuted, wealth management stocks plummeted. Raymond James dropped nearly 9% in a single day.

The Best and Worst Places to Work (While They Still Exist)

Before diving into the existential threats facing the profession, Dom shared his latest rankings based on over 21,500 data submissions from accounting professionals.

The winners surprised him. Andersen claimed the top spot for both job satisfaction (7.97 out of 10) and hours worked (averaging just 39 hours weekly). “I would have imagined that would have been a very tricky year for people at the firm,” Dom noted, given the IPO preparations. “But it seems like maybe the excitement, maybe some of the financial benefits have outweighed that.”

Plante Moran, last year’s champion, dropped to second place with a 7.73 satisfaction score, but the firm actually had the worst hours among all firms surveyed at 47.3 per week. “That hints to something else positive going on there,” Dom observed. “Might it be culture? Might it be compensation?”

Rounding out the top five were Weaver, Aprio (bucking the trend of struggling PE-backed firms), and Wipfli. On the other end, Citrin Cooperman posted the worst satisfaction score Dom has ever seen—just 5.13 out of 10. They were joined in the bottom three by MNP (a Canadian firm that acts like a PE-backed consolidator) and Cherry Bekaert.

The Big 4 landed squarely in the middle, with PwC slightly above average at 6.8 and the others hovering around 6.6. Tax professionals reported the highest satisfaction across all service lines at 7.05, while audit remained the lowest at 6.62, though both showed steady improvement year over year.

The Craigslist Prophecy

These rankings might soon become academic curiosities if a viral observation proves prophetic. Hunter Horsley’s tweet stopped David in his tracks. “In 2006, every section of Craigslist was a $1 billion marketplace startup waiting to happen. In 2026, every section of PwC’s website is a $10 billion AI startup waiting to happen.”

The parallel is haunting. Craigslist’s housing section became Airbnb and Zillow. Jobs turned into Indeed and ZipRecruiter. Dating spawned Tinder. One by one, entrepreneurs identified sections of the sprawling classifieds site, built specialized solutions, and captured massive value.

Now look at PwC’s service menu: audit, insurance, consulting, deals, digital assets, AI engineering, tax services. Each represents a potential target for AI disruption.

David had seen this movie before. “This is exactly what happened to QuickBooks desktop,” he explained. “Every menu in QuickBooks desktop got attacked by a SaaS startup.” Bill.com went after vendor payments. OnPay and others targeted payroll. Eventually, Intuit had to scramble to integrate or acquire these competitors.

But now the cycle is restarting with AI. As David put it bluntly, “AI isn’t going to take your job. It’s going to take away the business unit at the firm you work for. And then you won’t have a job.”

The Wealth Management Canary

Wall Street isn’t waiting for proof. Hazel AI is a tool that can ingest tax returns, pay stubs, and account statements to create personalized tax strategies in minutes. When it launched, the market’s reaction was swift and brutal.

Raymond James: down 8.87%. LPL Financial: down 8%. Charles Schwab: down 7%. These were established wealth management firms whose business models suddenly looked obsolete.

The consumer data explains why investors panicked. According to a Best Money survey, 82% of Americans now trust AI for financial information and guidance. More than half have actually used it, and of those who acted on AI’s advice, 65% said the outcome was good. Nearly two-thirds report their finances have improved since they started using AI.

Blake shared his own experiment. Facing a tax bill last year, he wanted to adjust his withholding. “I set up a ChatGPT project, took my pay stubs, dropped them in there, explained what happened last year, gave it my tax return, and said, ‘Help me adjust my withholdings.’ And it worked.”

This is exactly the kind of analysis CPAs charge for. But as Blake pointed out, the profession needs to stop asking whether AI will be as good as a human expert. The real question: “Is the AI going to be good enough to replace what I’m doing?”

For millions of underserved Americans who can’t afford professional help, AI doesn’t need to be perfect. It just needs to be better than asking coworkers at the car wash for tax advice, as David’s 19-year-old son was doing.

The Battle Over Data Moats

Intuit CEO Sasan Goodarzi and Xero CEO Sukhinder Singh Cassidy aren’t accepting the market’s verdict quietly. Both argue that Wall Street fundamentally misunderstands their competitive advantages.

Their defense is simply that data creates moats. Companies that “deeply understand their customers and own proprietary data” will win, according to Goodarzi. Singh Cassidy claims Xero’s “ecosystem of trust” makes cloning it “impractical.”

Blake thinks they might be right, at least about the general ledger. “QuickBooks has been dominant for so long because it’s the trusted general ledger system of record,” he explained. “To replace that trust is really difficult.”

The evidence supports this. Xero spent billions trying to crack the U.S. market and barely dented QuickBooks’ dominance. Even when Intuit makes unpopular changes like the despised new navigation bar, nobody switches. The friction is too high, the trust too important.

But the GL might be safe while everything around it burns. “AI is not going to disrupt the GL,” Blake argued. “What it’s going to disrupt is all the processes around it: what you do with that data, how you analyze it.”

TurboTax, for instance, looks vulnerable. Tax prep is essentially logic applied to forms, exactly what AI excels at. Blake proposed a thought experiment: create an AI agent for each IRS form, train it on the instructions, and link them together. You could potentially build a tax engine that way.

Meanwhile, “vibe coding,” using AI to build apps without traditional programming, is already replacing small business tools. Companies are building custom internal workflow apps, replacing $40-per-month SaaS subscriptions one by one. “When is it going to be ‘I’m going to vibe code my own QuickBooks?” David wondered. Not yet, they agreed. Accounting systems are too complex. But the question itself represents a shift in what’s possible.

What Survives the Disruption

Dom offered a crucial perspective on what endures when automation comes for professional services. “The human’s role often is to provide comfort and almost like taste, via their lived experiences and what they’ve seen with other clients,” he observed. Simple execution is at risk, but “where taste comes into play or lived experiences, I think that might be a little bit safer.”

He even noted an unexpected upside: bad TikTok tax advice has actually generated work for CPAs. People see questionable guidance online and seek professional validation. “It got the ball rolling for people to bring this forward because they know enough to know they shouldn’t just blindly follow this.”

The picture that emerges is complex but navigable. Systems of record, such as the trusted GLs that anchor financial data, appear protected by switching costs and accumulated trust. Advisory work that depends on those systems faces more immediate risk. And human elements like judgment, experience, the ability to comfort anxious clients, may prove surprisingly durable.

For practitioners evaluating their careers, understanding which category your work falls into becomes critical. Are you doing rote execution that AI can replicate? Or are you providing the wisdom, judgment, and human connection that clients will continue to value?

The firms that survive will find ways to layer human value on top of AI efficiency. That might mean AI-assisted services at lower price points with human review. It might mean focusing on complexity that AI can’t yet handle. But the first step is acknowledging that the market has already begun to move.

As accounting professionals consider their next career moves, Dom’s firm rankings offer one lens for evaluation. But the bigger question is which firms are positioning themselves to thrive in an AI-transformed landscape, and which are simply rearranging deck chairs? Understanding the satisfaction data and the disruption trajectory has never been more important for making that choice.

Listen to the full episode of The Accounting Podcast for the complete discussion, including more details on firm rankings and strategies for navigating the AI transformation.

Human Connection Still Beats AI in Accounting Despite What the Headlines Say

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Breaking news dominated a recent episode of The Accounting Podcast as hosts Blake Oliver and David Leary analyzed the Supreme Court’s landmark decision striking down Trump’s global tariffs. But the conversation quickly turned to what this means for accounting firms: a massive opportunity to help clients claim refunds on $133 billion in tariffs already paid.

The episode also digs into why taxpayers are losing trust in AI for tax preparation, how law firms are hiking rates to offset AI-reduced billable hours, and why human connection remains the profession’s secret weapon in an increasingly automated world.

A $133 Billion Opportunity Knocks

“The Supreme Court struck down Trump’s global tariffs in a six to three decision,” Blake announced at the start of the episode, barely containing his satisfaction at having predicted this outcome in previous episodes.

The court ruled that the International Emergency Economic Powers Act doesn’t authorize the president to set or modify tariffs, which are a form of taxation. Chief Justice Roberts, writing for the majority, emphasized that tariffs require clear statutory authorization from Congress, something the emergency powers act doesn’t provide.

But US businesses have already paid $133 billion in these now-invalidated tariffs. And while the court didn’t lay out a specific refund mechanism, those funds are potentially recoverable.

“I think there’s a big opportunity,” Blake said. “Smart accountants are going to jump on this.”

The opportunity mirrors the Employee Retention Credit (ERC) and Paycheck Protection Program (PPP) work that kept many firms busy during the pandemic. Firms will need to help clients identify affected entries, determine liquidation status, quantify refund amounts, and support administrative claims. If accountants charged even a small percentage fee for this service, Blake estimates it could generate “$1 billion to $10 billion in services revenue.”

David warned tariff refund mills will pop up just like ERC mills did, urging accountants to “beat them to the punch” by proactively reaching out to clients who import goods.

The situation remains fluid. Trump announced plans to impose new 10% tariffs under a different authority, using Section 122 of the Trade Act of 1974. But for now, accounting firms have a huge opportunity to deliver value to clients who’ve been paying these tariffs.

Why Taxpayers Are Backing Away from AI

While accountants scramble to understand tariff refunds, they’re also watching taxpayers lose faith in AI for tax preparation.

According to Invoice Home’s latest survey of 2,000 US tax filers, only 37% would consider using AI to file their taxes instead of hiring a professional. That’s actually down from 43% last year, despite all the AI hype.

“I think people are getting burned,” Blake observed. “The more you use AI, the more you recognize its failings.”

The generational breakdown shows younger taxpayers remain more open. Half of millennials and 46% of Gen Z would consider AI tax prep. But even they’re growing skeptical as they gain real experience with AI’s limitations.

Blake has a similarly nuanced relationship with AI. He described using ChatGPT to draft legal agreements with “flawless” results, completing in minutes what used to take hours. Yet he readily acknowledges that taxes are different. “Small errors can compound and create big problems.”

This declining trust should reassure tax professionals worried about being replaced. Taxpayers seem to understand intuitively that tax preparation requires expertise and accountability that algorithms can’t yet provide.

The $3,400-Per-Hour Question

Meanwhile, the legal profession is showing accountants the problem with simply jacking up rates when AI reduces billable hours.

Top partners at elite law firms now charge up to $3,400 per hour, with some niche specialties pushing $6,000. Partner rates jumped 16% last year among the 50 largest firms. Even junior associates can run clients $1,400 per hour.

“If there’s less work, there’s fewer billable hours, and they’ve got to make up the difference somehow,” David acknowledged.

But Blake sees disaster ahead. “Businesses are going to say, wait a minute, why am I paying $3,400 an hour for legal work that’s being done by AI?” He can now draft his own legal agreements using a $30-per-month ChatGPT subscription—work he previously would have paid lawyers to handle.

The absurdity peaked with news that KPMG Australia fined a senior partner $7,000 for using AI to complete an internal AI training exam. The same firm that’s publicly committed to spending $2 billion on AI globally.

“If you know how to use AI to cheat on the test, you’ve passed the AI test,” David pointed out. “Obviously, you have the skills to use the AI.”

The contradiction perfectly captures professional services’ confused relationship with artificial intelligence: desperately embracing it while simultaneously punishing those who use it too effectively.

The Power of Human Connection

The episode’s most compelling segment came from David’s interview with Dawn Brolin about the Accounting Cornerstone Foundation, which helps accountants attend their first professional conference.

The foundation raised about $45,000 last year and sent 11 people to conferences—each one potentially life-changing. But it’s not just about money. They help recipients overcome travel anxiety, select sessions, and find their tribe in the profession.

“We get on a Zoom with them,” Dawn explained. “We talk through their anxieties. We give them travel tips.”

One recipient has since become active on social media, attended more conferences, and regularly sends thank-you letters. His life changed because he met people who understood his challenges.

“AI will never replace human interaction,” Dawn emphasized. “It will never replace the human touch.”

This stands in sharp contrast to how many firms actually treat clients. David described his experience with his own accounting firm. “Subject line: ‘Reminder you have outstanding task.’ And then I open the email in a giant font that says ‘Outstanding Task to Complete.’ It’s a horrible experience. It creates anxiety.”

Compare that to Intuit’s new TurboTax campaign offering free Uber rides to their offices. They understand customer experience in a way many accounting firms don’t.

“Accounting firms focus on their internal processes too much and not the customer experience,” David argued.

Focus Time Is the Real Productivity Crisis

A Hubstaff study cited in the episode found that average workers only get two to three hours of true focus time daily without meetings, messages, or tool-switching.

The productivity struggles “weren’t about effort,” the study found. “It’s about constant disruption.”

Workers use an average of 18 apps each day. Hybrid teams report the least focus time (31%), while in-office teams get slightly more (45%). The differences are smaller than expected, suggesting the problem isn’t location; it’s how we work.

Even AI adoption isn’t helping. Despite 26% of firms now using generative AI daily (up from 3% three years ago), it hasn’t meaningfully changed how employees spend their time.

Looking Ahead

The paradoxes explored in this episode reveal a profession in transition. Taxpayers are losing trust in AI just as its capabilities advance. Law firms are raising rates to offset efficiency gains, creating an unsustainable value proposition. And the most transformative professional experiences still happen through human connection, not algorithms.

Here are the top three takeaways for accountants:

  1. Jump on the tariff refund opportunity before the mills do. This could be the next ERC-sized revenue opportunity for proactive firms.
  2. Don’t follow law firms down the path of inflating rates to maintain partner lifestyles. Clients with access to the same AI tools will eventually revolt.
  3. Invest in human connections and customer experience. Sometimes the most valuable service is simply helping someone find their professional community.

As Dawn reminded listeners, “There isn’t any competition in accounting” when professionals support each other. The same collaborative spirit should guide how the profession approaches AI—as a tool that enables more human connection, not a replacement for it.

Thriving firms use AI for efficiency while doubling down on relationships, advisory services, and the judgment that no algorithm can replicate. Listen to the full episode of The Accounting Podcast for complete coverage of these stories and more insights on navigating the AI-augmented future of accounting.