AI in finance and accounting
113.1 A3 requires a continuing awareness and understanding of technical, professional, business and technology-related developments relevant to the work undertaken. The last of those four categories was inserted by the technology revisions. R113.3 is the one nobody applies to AI: where appropriate, the accountant shall make users aware of the limitations.
§ 1 — Who it binds
Every professional accountant, and every accountant with authority over others doing the work. The principle is engaged wherever a professional activity involves technology whose method bears on the result — which covers any AI-assisted preparation, analysis or review — and R113.2 reaches a supervisor who never operates the tool personally. The Code takes effect through each IFAC member body that has adopted it.
§ 2 — In practice
Section 113 is the fundamental principle of professional competence and due care, and 113.1 A3 states what maintaining it involves: “a continuing awareness and understanding of technical, professional, business and technology-related developments relevant to the Professional Activities undertaken”. The technology revisions inserted that fourth category, and the insertion is more consequential than it looks. Competence had always been read against the subject matter — the reporting framework, the sector, the tax law. Adding technology-related developments makes the tools themselves part of what an accountant must keep up with in order to remain competent at the work, which converts something practitioners treat as optional professional curiosity into a component of a mandatory principle.
R113.2 extends the duty to those working under the accountant’s authority, who must be given appropriate training and supervision. In a finance function this is the provision with the sharpest edge, because it reaches the common case precisely: a supervisor who does not personally use the tool, overseeing a team that does. Supervision of AI-assisted work cannot be discharged by reviewing outputs, because the output is the part that looks right; it requires the supervisor to know enough about the method to ask a question the output cannot answer on its own. That is the demand clause 7.2 makes of an organisation, arriving here on a named individual who cannot pass it upward.
R113.3 is the sleeper. Where appropriate, the accountant shall make clients, the employing organisation or other users aware of the limitations inherent in the activities being performed, and shall explain the implications of those limitations. It is mandatory, and applied to AI-assisted work it is a disclosure duty about method rather than about numbers: a forecast produced by a tool that has never been evaluated on this business carries a limitation, and the people relying on it are entitled to know it exists and what it means for them. It is the personal counterpart of the instructions-for-use duty Article 13 places on a provider, except that it runs to whoever is relying on the work. Practitioners read R113.3 as being about scope limitations in an engagement letter. Nothing in it says so.
§ 3 — What a weak answer looks like
The supplier’s training certificate offered as competence. Everyone who touches the tool has completed the onboarding, the completion rate is reported upward, and the function considers Section 113 addressed. Supplier training teaches the interface and is built to make a product easy to adopt; it is not designed to say where the method fails, and it addresses neither supervision nor what users have been told. Three provisions are in play, and the certificate reaches part of one.
§ 4 — What discharges it
The artefacts an assessor asks to see, and what makes each one sufficient rather than merely present.
01
What a person must be able to do before using this tool on this work, expressed as capabilities rather than as courses attended. Without criteria there is nothing to evaluate anyone against, and the file records availability instead.
02
How this class of model produces its output and where it fails. An introductory session on generative systems evidences interest in the subject and answers nothing about the activities actually undertaken.
03
What the supervisor asked and what they were able to check for themselves. Reviewing an output is not supervising a method, and the duty attaches to the person holding authority over the work.
04
What the client, employer or recipient was told about what the work cannot support, in the deliverable rather than in a file note. Making users aware is an outward act, so an internal record does not evidence it.
§ 5 — Worked example
A financial controller signs off a quarterly cash-flow forecast produced by an analyst using a licensed forecasting tool. The controller has never used the tool. The analyst attended the supplier’s half-day onboarding session. The forecast is compared with the prior quarter’s actuals, agrees within three per cent, and is issued to the group treasurer, who uses it to size a revolving facility.
Whose competence is in question, and what does R113.3 add?
Both people’s, under different provisions. The analyst’s is the ordinary question, and a supplier onboarding session is thin evidence for it because it teaches the interface rather than the method. The controller’s is R113.2, and it is not answered by having reviewed the output: agreement within three per cent on a stable quarter tells you the tool reproduces a stable quarter, which is the condition in which any method looks competent. Supervision here means knowing what the tool does when the period is not stable, and whether anyone has tested that. R113.3 then adds a duty neither person has considered. The treasurer is sizing a facility on this number and has been told nothing about what the forecast cannot do — which scenarios it was not built for, how it treats a customer that has never behaved this way before. Where those limitations matter to the treasurer’s decision, making them known is not good practice. It is mandatory, and it belongs to the accountant rather than to the supplier.
§ 6 — Elsewhere
Where another instrument addresses the same obligation. These are correspondences, not comparisons — the Council does not rank one framework against another.
Article 13 requires a provider to supply instructions covering a high-risk system’s capabilities and limitations. R113.3 asks the accountant to pass a limitation on to whoever relies on the work, which instructions can inform but not discharge.
Clause 7.2 asks an organisation to determine the competence it needs and to retain evidence of it. Section 113 places the requirement on the individual professional, and on whoever supervises their work.
A correspondence indicates that two instruments address the same underlying obligation. It is not a mapping endorsed by either body, not a statement that one satisfies the other, and not a judgement about which is more demanding.
§ 7 — When it applies
15 December 2024
Effective date of the Technology-related Revisions to Parts 1 to 3, which inserted the words “technology-related” at 113.1 A3. An effective date for a code provision, not a statutory deadline. The principle itself is much older and no date is claimed for it.
§ 8 — Exposure
No Code fine; competence failures are pursued by the member body that adopted the Code
Professional competence and due care is a fundamental principle. A member body that has adopted the Code may investigate a failure of it and impose reprimand, fine, conditions on practice, or withdrawal of membership and the practising certificate. There is no regulator behind the principle and no monetary ceiling anywhere in the Code. Where the same work founds a civil claim, that exposure arises under general law and is neither created nor measured by the Code.
§ 9 — Where this is assessed
Examined in one credential, in the domains named on each card.
Responsible use and accountability · 15% of the paper
For finance and accounting professionals who use AI in analysis, close and reporting work — and verify the output before the numbers are relied on.
§ 10 — provenance
This page sets out what the instrument requires and what discharges it. The official text is the authority — these go straight to it.
§ 11 — Also read
Certification
What this page sets out is examined, on work the candidate has not seen, in the credential beside it. Every paper is machine marked against its key and every result is reviewed and released by a named person, and every credential is on the public register.
AIAC-FNAF
Certified AI in Finance & Accounting — Fundamentals2 hours · remote, proctored · valid 2 years
Ten questions on using AI at work. About two minutes, free. You finish as one of six types, with a card to share.
A free quiz from the AI Assurance Council. Not a certification.