A five-layer “AI trust stack” helps auditors put AI to work while keeping professional judgment at the center.
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The Disruptors
With Liz Farr
For CPA Trendlines
As AI takes on more audit work, David Marquis sees professional judgment becoming more valuable.
The Caseware CEO argues that the opportunity extends beyond faster document reviews and automated analysis. Firms can rethink how audits work while strengthening the consistency, accountability, and trust that clients and capital markets depend on.
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In The Disruptors, Marquis explains why putting AI to work requires more than a powerful model — and why the profession’s human responsibilities remain central to its future.
“They’re not simply knowledge industries, they’re actually workflow industries,” he says of audit and accounting.
By following workflows consistently, professionals can deliver work that clients, regulators, and capital markets can rely on. AI creates an opportunity to redesign that work, “and not just do it faster, but also do it differently and do it better.”
Trusted AI requires more than a powerful model.
For highly regulated professions, Marquis says, a large language model “isn’t enough to have trustworthy AI.” Audit and accounting require work that is consistent, explainable, and reviewable. To describe the infrastructure needed to support those expectations, he offers an “AI trust stack” with five layers.
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At the foundation is intelligence: the models and reasoning systems. Above that is an agentic layer capable of performing work, followed by the end-to-end workflow in which that work happens. The fourth layer supplies context, including the firm’s methodology. The fifth provides governance through oversight, permissions, documentation, and accountability.
Each layer contributes to the system’s reliability. Yet Marquis says “a lot of firms are just at the intelligence layer. They’re just at the starting point.”
Connecting the layers helps firms move from isolated AI interactions to tools embedded in their operating environments. “It becomes so much more powerful, because you can trust it as you go along,” he says. Building that foundation takes time, but Marquis sees it as essential to giving practitioners greater confidence in AI-assisted work.
AI can help keep risk assessment connected to audit procedures.
One opportunity is strengthening the relationship between risk assessment and the procedures auditors perform. Although risk-based auditing is well established, Marquis says deadline pressure can pull practitioners toward familiar routines.
“When busy season arrives, the path of least resistance is often just to default to last year’s work.”
The challenge is not necessarily a lack of knowledge or training. Auditors must synthesize financial information, prior-year findings, board minutes, industry developments, and qualitative information under significant time pressure.
“The risks are documented at the beginning of the audit, but they don’t always dynamically influence the procedures that follow,” Marquis explains.
He says an AI trust stack embedded in the engagement workflow, as in Caseware’s Verity tool, can help maintain context, identify anomalies, surface prior-year findings, and flag situations in which procedures do not align with identified risks. That connection can make risk assessment “a living active part of the engagement, rather than just a document that gets created at the beginning of the audit and then set aside.”
The technology supplies information and context. The auditor remains responsible for deciding what that information means and how to respond.
Faster document review still requires professional judgment.
Marquis also points to disclosure checklists as an opportunity to reduce time-consuming work. He says Caseware’s Verity Disclosure Checklist agent can help experienced auditors complete that work 75% faster. He frames that potential gain as a reduction in the time required to locate and review information while preserving the professional’s responsibility to evaluate it.
“It’s not abstracting away the judgment, right? It’s actually teaching them,” he says.
An agent can quickly locate a relevant passage in a 300-page document. The auditor still must assess that passage and make the final determination. The distinction matters: Faster access to evidence can give professionals more time to interpret it, investigate questions, and exercise judgment.
AI could accelerate the development of new auditors.
Marquis expects AI to automate much of the information gathering, documentation review, and basic analysis traditionally assigned to new auditors. He sees that shift as an opportunity to accelerate their development.
“It’s going to radically compress that learning curve for an entire generation of professionals coming into the audit and accounting space,” he says.
His outlook puts professional learning alongside efficiency as a potential benefit of AI. The value comes from helping auditors understand and evaluate the work, even as technology changes how they perform it.
Firms must move beyond successful experiments.
For firm leaders, Marquis says the challenge is moving from AI experimentation to implementation. Too many organizations remain in what he calls “AI pilot purgatory”: They demonstrate that a tool can work but never make it part of everyday operations.
“I think it’s important to stop endlessly testing things,” he says.
Moving a successful pilot into practice may require changes to responsibilities, processes, and the organization of work. Marquis describes that process as “a genuine reckoning of how the work has to be organized to make it work, and who has to do that.” The transition can be uncomfortable. But firms that work through those changes, he says, “are seeing real returns from AI.”
The profession’s human responsibilities become more valuable.
Marquis remains optimistic about accounting’s future. “The accounting profession is going to be more valuable, not less,” he says.
As technology handles more routine work, he expects greater emphasis on professional judgment, ethical reasoning, client trust, and the ability to interpret complicated situations and advise on their implications. Those responsibilities help define the profession’s value as its tools and workflows evolve.
“In 10 years, I see a profession that has gone through significant and maybe some uncomfortable transformations along the way, but one that has come through with a clear sense of its own value, a more sophisticated relationship with technology, and actually a more important role in the economy than it has today, which is already very significant.”
10 Key Takeaways
- Accounting technology will increasingly move toward connected ecosystems rather than collections of disconnected point solutions.
- AI won’t reduce the need for junior staff, but it will accelerate their learning curves so they add value sooner.
- Firm leaders’ skepticism about adopting AI is often rooted in governance concerns, change management, and where a particular leader is in their career.
- Curiosity will be a defining trait of leaders who navigate this transformation well.
- The discomfort of making a difficult decision doesn’t decrease by delaying it. That usually makes it harder.
- Leaders should distinguish between reversible “two-way door” decisions that can be made quickly and consequential “one-way door” decisions that require more deliberation.
- Technology choices shouldn’t be made based on an impressive demo. Instead, leaders should consider how well the tool will perform within their actual workflow and governance requirements, and whether it will produce reliable and defensible results.
- Consider the difference between speed and velocity when making difficult decisions. Speed has no direction, but velocity is a vector, so you are moving fast but in a definite direction.
- The role of a leader is not to pretend that you have all the answers, because you never will.
- More data and more complexity will increase the need for trusted professionals who can make sense of the information and provide assurance.
About David Marquis
David Marquis is CEO of Caseware, one of the world’s leading providers of audit, assurance, and financial reporting software, serving more than 500,000 users across 130 countries. A Canadian technology executive with more than 20 years of experience leading high-growth software and technology businesses, Marquis joined Caseware after serving as Vice President and Canada Country Manager at Intuit. He previously held senior leadership roles at Google Canada and Bell Canada, and earlier in his career worked at The Boston Consulting Group and Rolls-Royce. An accredited professional engineer with an MBA, Marquis brings experience spanning engineering, strategy, and enterprise software to the leadership of one of Canada’s most successful global software companies.
Transcript
(Transcripts are not edited for spelling or grammar.)
Liz Farr
Welcome to the Disruptors. I’m your host, Liz Farr from CPA Trendlines, and my guest today is David Marquis, CEO of Caseware. Welcome to the show, David.
David Marquis
Thank you, Liz. It’s a pleasure to be here.
Liz Farr
Well, I’m really glad that you’re here, because I really like to bring in with very different backgrounds, and especially from the audit world. I don’t think that auditors get enough attention in today’s world,
David Marquis
if Yeah, no, I think it’s great. It’s great that I love the diversity of folks that kind of lean into the space, so it’s great to be a part of it.
Liz Farr
Yeah, now for listeners who aren’t aware of Caseware, can you tell us what Caseware is?
David Marquis
Absolutely, yeah, so Caseware it’s a global AI platform for accounting professionals. We serve more than 23,000 firms globally across 130 countries, so truly a global footprint. We cover small regional practices all the way up to some of the world’s largest firms and networks, and our platform basically powers audit, financial reporting, and compliance workflows across all of those, and so the problem ultimately that we’re really trying to solve, or trying to help firms with, is to take and do professional work at scale with consistency and with the kind of trust that clients, regulators, capital markets, etc. really depend on, and so you know what I believe is audit and accounting. They’re not simply knowledge industries, they’re actually workflow industries, and therefore the work will follow structured processes, and those processes kind of exist for a reason. There are mechanisms by which the profession gets to conclusions and earn the right to be relied upon with that trust across the market. So, for more than 35 years, Caseware has been building this technology that underpins this and supports these workflow processes, and it’s kind of an exciting time, because what’s changed now with AI is that there’s really an opportunity to look at that fundamentally, rethink how the work gets done, and not just do it faster, but also do it differently and do it better. So that’s the problem that we’re focused on right now, and it’s I think it’s one of the most interesting challenges today in the tech industry overall,
Liz Farr
yeah, yeah, no, I, I’ve heard lots of my audit friends talk about how great Caseware is sort of the backbone, the foundation for their work, that that it really gives them a solid place to do the work, not just to pull the reports, but to do the work.
David Marquis
Yeah, yeah, absolutely. We hear the same thing. I mean, when I, when I started with the company, I was amazed by just the. I didn’t expect the brand affinity that is there, and I guess it’s built over time, right? That trust over time builds a very powerful brand, and so even when you look on LinkedIn and see people in the industry, they put Caseware as a skill, right? It’s a skill on their, on their, on their profile, on the resume, and so I’m really proud about that, and the whole whole company is sees it. It’s actually our mission to power trust in the global economy. That’s how we think about it. How do we support professionals and support the profession, so that it, so that it can be trusted and be there for when it needs to be to support our global, our global system, and how it works overall in terms of the financial markets. So to be a part of that as a company and as individuals in this company, it’s really gets us up every day.
Liz Farr
Yeah, now as I understand, Caseware recently released a new product called Verity. What, what is Verity?
David Marquis
Yeah, is something we’re really excited about. Verity is our AI intelligence and orchestration layer that operates inside of the assurance and financial reporting engagement software, basically the structured workflows I was talking about earlier, we’ve now built and have launched an AI that, unlike standalone maybe AI assistants or disconnected co-pilots that you may have heard of, Verity actually understands the engagement itself, the context it’s. Itself, it can draw on work papers, it can draw on prior year files on supporting documentation on firm methodology and professional standards to provide contextual guidance throughout the engagement, and we think that distinction is everything, because most AI tools that firms are using today, they’re operating sure at the model level of the intelligence level, they can generate text or summarize documents or analyze things, but they can’t actually understand what’s happening in the engagement, and so, you know, they don’t know what stage of the workflow you’re in, they don’t know what the prior year looks like, they may not know about exactly what the methodology requires for your firm, and they may not know the risk profile of a customer, et cetera, and so Verity does, and that’s the thing that when it operates inside the Caseware platform, and it can draw on all these elements, it ends up not being a bolted on solution, right, but it’s actually embedded within it, so, so that’s that’s exciting. First point, the second point is a Verity is the starting point for what we call our Verity agent suite offerings. These are a series of specialized AI agents that automate repetitive tasks, such as documentation review, risk identification, or disclosure analyses, we were talking about this one earlier, and the goal is not to just replace auditors, but it’s to reduce administrative work, surface insights, and give professionals more time, so they can focus on judgment, focus on analysis, and focus on client service. So we’re really excited about Verity. It was just launched a couple months ago, and we’re already seeing some great traction and feedback, and so we’re excited.
Liz Farr
Yeah, I think it’s cool, because it sounds like sort of a, a gentle and kind embedded advisor, somebody who is and wise advisor, somebody or an entity, almost like an entity that is there who understands the whole engagement and what audit is, so that then you can say, hey, you know, what was this client’s cost of goods sold two years ago, is it changed dramatically, and what about this risk that we noticed a year ago? Do we still need to do the testing for this, or has everything been resolved?
David Marquis
Yeah, you know what’s really interesting, actually, Liz, is we struggled a lot with what to call it, because it’s not an assistant, and what did you just call an advisor? It’s sort of an advisor, but can also act, so it’s not just an advisor, it’s not, it’s not quite a teacher or a coach, although it can do that as well, and it’s something that it’s hard, it’s hard to put a word on exactly, but we’ve moved beyond in the industry, from, you know, chat bots, and, and sort of, you know, places that you would go just to get answers, and it’s, and it’s far more powerful now, with the intelligence layer, with all the stuff that I’ll talk about in a bit. It’s so, it’s really exciting, because it’s, it’s teaching, it’s teaching people how to do the work better, it’s actually suggesting things, and it’s actually acting in some ways to, to, you know, create better outcomes, and so this is, and this is just what it’s doing today, and these things are going to get better and better as time goes on. So it’s really powerful what’s happening right now as we look at those, those trends.
Liz Farr
Yeah. Now, now, lately, you’ve been writing and speaking about something you call the AI trust stack, so I found this really fascinating. Can you explain what this is?
David Marquis
Yeah, of course. So the AI trust stack, it’s something that actually I came up with as I was thinking about, you know, all these technology trends, and what professional firms are looking for, and some of the challenges with AI. Right, we have to make sure that it’s truly trustworthy, and that it, and that’s especially important in all industries, but especially for highly regulated professions like audit and accounting, because everybody’s had, you know, experiences with these powerful new models, these LLMs that can do a lot across many industries, but a powerful model alone isn’t enough to have trustworthy AI. Professional services operate really within these systems of trust that I was mentioning earlier, so clients, regulators, lenders, capital markets, they all rely on work that’s consistent, explainable, reviewable, and so just because you have a model doesn’t make it, doesn’t mean that there’s trust inherently in the outputs, and so as I was thinking about this, came up with this concept of this AI trust stack that has multiple layers that are required to make AI work in professional environments, so at the foundation level it is the intelligence layer, so those are the models, the reasoning systems, or to think of that as the Chat GPT or Anthropic models. Above that is above that is is sort of an agentic layer, so that creates, you know, the ability to do the work itself. So that’s the second layer. The third layer is the workflow, the end-to-end workflow, because the agents need a place to do the professional work. Then the fourth layer is context, you need the right context in the system to understand, you know, the context of your firm, the methodology, etc. and then finally it’s a governance layer, because there’s oversight, there’s permissions, documentation, accountability that has to be there as well, and so you need all four layers to be, or sorry, five layers to be effective, and so a lot of, a lot of people, a lot of firms are just at the intelligence layer, they’re just at the starting point, but they really need to have a framework for thinking how they can kind of put AI effectively into their, into their operating environments to make it effective, and so that’s that’s the kind of trust that there’s five layers, and just gives us an easier way to kind of discuss the topic with firms and for interest and with interested folks, as we’re talking about AI adoption, because otherwise people just default to the first layer, the intelligence there, but it’s, it’s far more than that.
Liz Farr
Yeah, you know, a lot of people just think that AI is just Claude or Chat GPT, and those are a little bit scary for most accountants because they are so unbounded and they don’t always really tell you the truth, they’re they have their own kind of reality that is invented on the fly, but for accountants and auditors, we can’t have that, so we need a trust stack that tells the AI these are the parameters that you operate in and these are the things you do, you know, and I think that this concept of the trust stack would be very reassuring to most skeptical accountants.
David Marquis
Yeah, yeah, and we were, you know, I’ve spoken about this at a few conferences, and it’s really resonated. It’s really resonated with folks, because everybody feels the need to everyone has a desire to leverage AI in the right way to help their business, to help their firms, to help their customers and their clients, but it’s often difficult to know how, right, and a lot of these, you call them open bounded or open open-ended models, it’s hard to know when the answer is coming back. Is it, you know, what’s the judgment in there? Is it like, where’s the traceability? And so, when you can, we can actually build the right layers to be able to use AI effectively. It becomes so much more powerful, because you can trust it as you can, as you go along, and you have confidence that you’re even if it takes a little longer to get there, and so it’s this balance of the technology is moving so quickly, there’s this desire to adopt, but that there’s this lack of awareness exactly how to do it, and what’s the best way to approach it, and so we’re trying to get the message out there around some guidance on the topic, and we’re trying to build products that help people actually capitalize on the technology trends.
Liz Farr
Now I have a question about kind of methodology. Since 2007 or so, a risk-based approach has been part of the audit standards, but when I was helping people, helping cpa.com last year on the audit benchmark survey, we found that firms were really struggling with this, they would do the risk assessment, but they didn’t really know quite what to do with that, and so they would follow the same methodology as the last year. So, how will Caseware’s Verity help with this?
David Marquis
Yeah, yeah, that’s a great.. well, let me, let me touch on that topic, and then how we see Verity helping. So, I think it’s what, like you said, it’s one of the most persistent and frustrating challenges in audit, and I don’t think it’s really a training or standards problem. It comes back to that workflow and process topic, but I, you know, it’s a workflow problem, and so you know firms understand the risk standards, and their people are generally well trained, but meaningful risk assessment requires synthesizing enormous amounts of information, financial data, prior year findings, board minutes, industry developments, qualitative information too, often under very significant time pressure, and so when busy season arrives, the path of least resistance is often just to default to last year’s work, and so, so that challenge, and the so, in that sense, the risk assessment and the execution of the engagement becomes disconnected, and you know the risks are documented at the beginning of the audit, but they don’t always dynamically influence the procedures that follow, and so with Verity, we’re helping to bridge the gap, because it operates across the entire environment and engagement, and it can bring together multiple sources of information quickly, surface the engagement-specific risks with supporting rationale, maintain the context throughout the workflow, and it also can identify anomalies and client data, surface relevant previous year findings and highlight situations where these procedures being performed may not actually align with the risks that have been identified, so in effect Verity takes risk assessment from a static into more of a living active part of the engagement, rather than just a document that gets created and then just kind of at the beginning of the audit, and then set aside, and so this is a really great example of how technology really doesn’t replace professional judgment, it all, what it does is gives auditors and professionals better information, allow gives them tools to maintain that context, throughout the engagement, and help ensure that the risk-based thinking that is there actually gets reflected in the work and how it’s actually performed, so it’s like technology enhancing the judgment and the professional expertise rather than anything else.
Liz Farr
Yeah, so, so just to understand this, does that mean that that after Verity helps with the risk assessment, would it then guide the methodology, suggest tests, suggest ways that the current year methodology could be made better than last year?
David Marquis
Yeah, it’ll give, it’ll, it’ll, it’ll, it’ll perform, you know, it’ll create awareness on those different data pieces that I was mentioning, it’ll provide suggestions, it’ll kind of run even analyzes if you want, but ultimately it leaves the power of the decision clearly with the judgment of the professional, and so it’s just compressing, you know, the amount of time that it takes to get to those outcomes. It’s just providing a lot more context and information upfront, and it’s in many cases teaching younger professionals how to learn how to do this, so that it impresses their learning, their learning curves as well. So it has multiple, multiple benefits in that sense,
Liz Farr
well, I am sure that a lot of the auditors who I’ve spoken with will be very excited about this. Now, now, something that I’ve heard from some of the tech forward auditors I know is the challenge of interoperability between tools and platforms. Quite often the methodology is tied to a platform, but the tools don’t always work within the platform, so sometimes you have to go outside of the platform to get the tool to work because it just won’t work inside, so what do you think about that? How is this going to look in the future?
David Marquis
Yeah, no, it’s a definite issue in this space for this profession, but also in many, in many tech stacks, right, there’s this question of, hey, how many, how many offerings are there, and how many tools do folks use, and you know, should are there fewer, fewer tools, and therefore more interoperability, or are there more point solutions, etc. So, in general, I believe we’re moving towards overall, and in this profession specifically, a much more connected ecosystem. So, historically, firms have had to navigate, like you mentioned, through multiple applications, duplicate information manually, connect workflows that were never designed really to be connected and work together, but this is a known problem, and the next generation of platforms are going to be a lot more open, be more composable, so you can take the pieces, connect them up better, information will be able to move more freely through the systems, and AI agents and other mechanisms to get the work done will be. Able to coordinate tasks across applications, across professionals, and will allow them to spend less time navigating tech, right, and more time applying expertise. The technology will fade into the background, and so firms increasingly expect this. They expect their technology platforms to maintain the context and act as a system of record rather than a collection of disconnected point solutions, and again, I think if you take a step back and look at the tech space in general, you’ll see big platforms that grow to scale and have, you know, a lot of global presence, and then you have these point solutions that serve place and time needs, and over time, what tends to happen in these spaces is they consolidate, right? There’s fewer providers that do more of the work, it’s better for the customer, it’s better for often the offering itself, like it just feels better to operate, and then also because of the need, these platforms tend to have more open architectures, a lot of API connections, and in an agentic world, so in this new AI world, there’s going to be, we’re evolving into standards that will allow for information to flow more easily between these, these platforms and these, these, these solutions, and so it’s not quite there yet, but it’s definitely a trend that’s trending towards more of a connected ecosystem rather than a separate ecosystem that makes sense.
Liz Farr
Well, I’m excited for all my audit friends, you know, it was partly the clumsiness of the tech solutions that caused me to throw up my hands in frustration when, whenever I was the warm body called in to help out on an audit with, well, you do this piece over here and this tool, and then you do this thing over here and this tool, and then this other thing. Well, it can only, it only works in Excel, and then after you’re done with it, then you have to import it over here, and it was just like, come on, make it easy for me, I don’t want to play with the tech, I just want to do the work,
David Marquis
yeah, you know, I, I feel that myself in many ways when I’m trying to do my work. Yeah, you want the tools to fade in the background and just allow you to do your thing, for sure.
Liz Farr
Absolutely. Now, How is AI changing what auditors do? You know, when I was an auditor, I spent a lot of time ticking and tying and looking at this document and comparing it to this thing in the client’s records, so how is that going to change in the future?
David Marquis
Yeah, yeah, no, I think it’s going to, it’s going to change, it’s going to change a lot. It’s happening quickly, and I think it’s going to change how the work gets done for different folks in different tenures. So, it’ll change for the junior auditor, for the manager, and as you, as you progress in your career, I think it’s really going to change the whole next generation of professionals and what they end up, what they end up doing, and spending their time on. So, and I think AI is beginning to automate many of those activities that historically consumed a significant amount of time, and weren’t perhaps the most fun parts of the job, if I were to say it that way, particularly for junior professionals who, after act, who actually have to tackle this at the beginning of their careers and learn, right, and so that’s like whether it’s gathering information, reviewing documentation, performing basic analyses, you know, these things can increasingly be handled with the assistance of AI, and I think what will happen here, especially for more junior professionals, is it’s they’re really going to have their learning curves accelerate far quicker, which will actually make them a lot more valuable, much faster for firms. So, basically, it’s going to radically compress that learning curve for an entire generation, I believe, of professionals coming in to the audit and accounting space, and so one example, and I think we spoke about this before, is one of our Verity agents, it’s called – we launched it just a month or two ago – it is called the Disclosure Checklist, the Verity Disclosure Checklist, and as you know, this dreaded task that takes hours for auditors, and especially difficult for new auditors, because they also have to be taught how to do it, and so it’s the worst of both worlds. It takes a long time to learn, and it takes a long term time to come to complete the work, even when you know what you’re doing, and so the really exciting part, and this is just an example with the Verity Disclosure Checklist, is that auditors can now get that work done, experienced auditors can get that work done in 75% faster, right? So it’s pulling out the majority of that time, not only that, but the agent can teach new professionals how to actually do the checklist step by step, so it solves both, both kind of challenges and gives a lot of time back and compresses that learning curve. Now that’s just one kind of task. Now imagine that through many, many, many different parts of the workflow, and you start to see the power of, wow, this AI, these AI agents that are being launched are going to just start to make make auditors’ lives easier in the day to day, and also help junior folks who are joining just accelerate their careers a lot faster, which is just an exciting thing to consider and think about, because you know the profession needs more professionals, needs folks, needs junior ones coming in and learning faster? A lot of people are worried about the impact of AI on what is going to, you know, happen with with folks in these firms, but I think it’s going to allow people to just learn faster and just get to that point where they’re adding value a lot quicker.
Liz Farr
Oh, I, I wish that Verity had been around back when I was an auditor, you know. You mentioned the dreaded disclosure checklists, and, and you know, I think that this will be really a mindset shift for the entire audit profession that the way that audit has been taught and learned in the past that that whole methodology is just gone or should be gone and so instead of muddling through all the the mindless and tedious ticking and tying and cross checking and this and that, you can get an agent to do that, and then it’s much quicker to connect from that to what the auditor learned in school in their audit classes, and what the audit standards require. So I think this will be exciting.
David Marquis
Yeah, and an important thing there too, Liz, it’s it’s not abstracting away the judgment, right? It’s create, it’s actually teaching them, so one of you know the disclosure, it might, you might be going through a 300 page document, and you have to use your eyes to find the passages, and it’s just hugely tiring. So the AI just does that quickly, but then it still tees up for you. You have to make the judgment based on the just finding information faster, it’s compressing these tedious tasks, but it’s never abstracting away the judgment that ultimately is required. I think that’s something that is unique in this profession, and something that is really important as you deploy AI in a trusted way as part of an AI trust stack, right, to be able to do it in a way that has all the benefits of automation and AI, and that time savings, but never takes away from the professional judgment that’s so important, that’s core to the principle of what, what it’s all about, and so you know it’s really exciting to see both of those things play in tandem, and that’s why we really see it as our responsibility to make sure that that’s happening effectively for folks as they transition to this new world.
Liz Farr
Yeah, yeah. Well, well, I think it’s going to be exciting. I think it, it is certainly going to be a challenge for firm leaders to accept that the new generation will be learning in a different way, or you, you’re are you seeing that kind of pushback or challenge in the firms that you work with?
David Marquis
Not, I, you know, that’s a great question. I’ve never, I think the challenges we hear most frequently about are okay, we know we should be using AI, but how do you do it, you know, effectively or with the right governance, or with the right so often it’s like, hey, I know I need to use AI, but I’m kind of worried about the risks, the perceived risks around the loss of compliance and governance, and so that’s one element, which hence, you know, the previous part of our conversation, sometimes it’s about, ooh, I, you know, I’m not sure there’s going to be as many professionals. Like, is this going to impact young people? Is going to impact jobs as they come in? Are we going to need junior folks? And I don’t think it’s actually going to replace the need for junior folks. I think junior folks are just going to come in and learn a lot. Faster, and get to value a lot faster, and so I think there’s that element. I think there is change management, right? Like, people are used to doing things a certain way, and that includes what you know, what tools they use, even if they’re not crazy about them, or like how they run their engagements, and how they do their work, and so there’s just a general change management, you know, hurdle to get over, but I think most firm leaders, it depends on demographics too, because if they’re way at the end of their career, they may not be as leaning into the next, you know, phase of technology. So I think demographics play a role too, but no, generally I think people people acknowledge that this is really important. We have to do it. It’s just like, how do you do it in the right way, and there’s a gap in sort of sufficient knowledge or awareness of the tools that exist of the approach that is the best for their firm, etc. That’s typically what what I hear.
Liz Farr
Well, that’s that’s encouraging, because you know, I remember on the audit benchmark survey, there were a few people who said, yeah, the leaders are not going to be changing, they’re not adopting any tech, we have to do it the way that they’ve been doing it for years, so, but that’s that’s good to hear, but that, that may be just because the people that approach Caseware are more on the leading edge of tech adoption, they are, they’re more enthusiastic about using technology to make their lives better,
David Marquis
that’s certainly true. Like a lot of our key contacts and folks that we talk to are driving that innovation, but if I, if I do talk about the senior folks, and again, like there’s some folks that are heading off to retirement and may not be, as you know, leaned into this, but if you look at the economics of what they’re trying to do as firm leaders, it’s to make their firms more profitable, it’s to it’s to help them grow, it’s to help through this staffing challenge, the human capital element that I was mentioning before, these are real financial and operational drivers that they can’t ignore, and so technology plays a big role in, in, you know, driving those outcomes, and so I would say that most, most rational kind of firm leaders that, that are are looking at those trends are looking at technology, you know, investments and changes to make that happen, with the exception, of course, of like the demographic element that I mentioned, where certain folks maybe just aren’t, you know, in it for the for the longer term, so to speak.
Liz Farr
Yeah, and and for those people, you know, you can say, you know, look, we need to do this because if we’re going to fund your retirement, we need to be on the leading edge of efficiency and effectiveness. We need to be on that leading edge, you know. You can. I would love for you, you know, Mr. Auditor, who’s been auditing since the 60s or 70s to just stay there and give the financials your, your 10,000 or 20,000 foot magic blessing, and, and just, you know, keep doing that, because you have a skill that we don’t,
David Marquis
yeah, yeah, but the good news is that the, you know, I think this is really accelerating. We really see it every day, that, that, and to some degree, this, this, the profession has been a bit behind and a bit in terms of technology adoption, and we’re seeing that trend through all the different metrics pick up, and so, and I think AI is just accelerating even more. I think folks recognize, oh wait, we actually do have to move faster to benefit from this, and so it’s, it’s exciting. There’s a lot of, there’s a lot of change in the air.
Liz Farr
Yeah. Well, kudos. kudos to Caseware for leading the way and helping us drag the laggards into the future.
David Marquis
It’s actually, you know, it’s actually the leaders in the firms that we’re partnering with that, you know, the innovation leaders and the change agents, they’re the ones doing the hard work, we’re supporting them, but they’re there’s a lot of energy around transforming these firms to bring them, bring them to where they need to be, so we’re happy to partner with those folks.
Liz Farr
Fantastic. Well, now I’m going to ask you some questions that I ask most of my guests for. First of all, is about learning from mistakes. What would you say is the most valuable mistake you’ve made, and that’s valuable in terms of the lessons you learned?
David Marquis
Yeah, I like that term, valuable mistake. I’ve never actually heard that before, but I really like it. So, I think my most valuable mistake, and I suspect it’s one a lot of leaders would recognize, is moving too slowly. Right, we talk about being laggards, talking about, you know, sometimes, especially when you feel like you already know the answer, you have a gut or you have a strong sense. There’s been moments in my career where I had a pretty strong read on a situation, whether it’s a strategic direction that’s required, that’s needed for a change, or a decision that needs to be made, but I waited, and you know, I gathered more information, I waited to build consensus, I gave the process more time, maybe than it needed, and usually because the decision was either uncomfortable or had significant implications, but the more you know, or the more I advance my career, the more, and I learned from these moments, it’s that the discomfort of a difficult decision doesn’t decrease with time, usually it increases, and so the situation doesn’t resolve itself, and the longer you wait, the more you’ve paid in an opportunity cost, team uncertainty, and other things, and so the lesson I took from all of that is to trust myself to not be reckless, but to recognize when, hey, we’ve done some good thinking about this, and if I’m hesitating, it’s usually just be usually just hesitation, and the best leaders that I’ve worked with make hard decisions fast, often with incomplete information, and they make them with clarity and conviction, and so that’s a skill that I’ve learned over time, and of course I’m speaking to an audience of auditors, I don’t mean for that element of the work, but I’m talking more about leadership, you know, team building, strategic direction that you need to point an organization in, you don’t want to have the luxury in this time, this day and age of waiting too long to drive towards decision speed is of utmost importance to most companies, and especially if you’re in the tech sector like we are for Caseware one must move at utmost velocity, not just speed, because speed doesn’t have a direction, but velocity, because it has a vector. You’re going fast, you’re going in a direction that’s defined. So, yeah,
Liz Farr
yeah. Well, I can understand that, and I think many other leaders have been guilty of acting too slowly, but that’s it’s great advice. And what advice do you have for accountants who would like to be better as leaders?
David Marquis
Yes, so apart from moving quickly, which we and driving to fast decision making, which we just covered. Think the other thing is probably curiosity. Curiosity, and so if you think about the conversation we’ve had, and just the pace of AI, which has been genuinely extraordinary, and when you think about it, there’s this temptation, particularly for experienced leaders who have navigated a lot of technology cycles to categorize it too quickly to either say, oh, it’s overhyped, or you know, to make a conclusion one way or another, without actually spending time in it, without really understanding what the technology can and cannot do, and like sit with that uncertainty around, hey, where is this going? And I think, yeah, I think the one, the leaders that really excel in these times are genuinely curious, they’re trying things, they’re experimenting, they’re putting, for example, AI in front of people and watching what happens, and then they’re asking hard questions, and you know, being honest about the answers, and so that’s that’s one. I think second thing I would say is that leadership is in a period of transformation, and it’s fun. It’s fundamentally about trust. We talked about trust before. You know, sometimes folks are uncertain around transformation. You know, there’s some things happening in the profession that creates some, some concerns. The role of a leader, in my opinion, is not to always pretend that you have all the answers, because you don’t. You don’t know exactly what’s going to happen in the future, but if you can be honest about what you do know, and if you can create conditions for your organization to learn and adapt and transform it can make that you know you can chart the path forward for them a little bit in throughout that you know that transformation phase and so yeah I think I think accountants who really follow their curiosity during this time and who are able. To articulate a direction for themselves or for their teams or for their companies during this phase of transformation. I think those things are incredibly valuable.
Liz Farr
Oh, I would agree with you there 100%. Now, now accountants really know, kind of, you know, we’ve, we’ve been really good at following SALY, but what are some things that accountants should stop doing immediately?
David Marquis
Yeah, I guess it’s the, you know, putting the fast, the fast decision making and the AI curiosity and the transformation pieces together. I think it’s, I think it’s not, I think it’s important to stop endlessly testing things, right? So there’s a little bit of an epidemic in terms of AI pilot purgatory that’s happening right now, where there’s a proof of concept and goes well, and then it’s sort of there’s no follow up, or it doesn’t scale, or you know, it sits in a part of the organization where it doesn’t move forward, and so I think following curiosity is one thing, but it actually has to, it has to go somewhere, and so the reason this happens is usually not skepticism about the technology, it’s actually that there’s something that has to happen or in or around that within the organization to make sure that it can actually be effective, so that that whether it’s getting change management through people, whether it’s training, whether it’s a genuine reckoning of how the work has to be organized to make it work, and who has to do that. These create really uncomfortable kind of decisions, but firms that are seeing real returns from AI, in particular the ones that can push through this discomfort, get away from this cycle of testing, and get committed to a platform, get committed on, you know, what happens, what has to happen in the workflow and the way the work’s done. Invest in their people, and then you know, move forward kind of quickly once they know enough of, like, okay, this is the right direction, which I recognize is hard because people are still struggling, like we talked about the beginning of this discussion around what’s really happening, and do they understand, you know, the technology in the space, and so that’s what you know, and then, moreover, I think the other thing we should stop doing is just evaluating solutions based on just an impressive demo, right? It’s not, it’s much more than that, it’s, it’s, it has to be put into a controlled setting, and actually tested. The right question is, Can this tool operate inside of your actual workflows with actual data with your actual governance requirements, and produce results that professionals can really rely on and defend? And it’s a much higher bar than than than just testing kind of a demo on the side, and my belief it’s the right bar, so yeah, I think it’s, it’s about, you know, pick your horse, pick your approach, and and go forward once you’ve tested it to a certain degree, because it will never be perfect, but you got to find that that that lane to make sure that you can drive things forward,
Liz Farr
yes, and after all, if things really don’t work, then you can probably start over.
David Marquis
Yeah, there’s this.. I’m not sure if you’re, if you know the two-way door concept that I think Jeff Bezos and Amazon popularized this, which is basically is it a one way door or a two way door, and that should, so can you go through this decision and then walk it back with minimal kind of cost or impact ramifications? If so, make those decisions quickly. You can go through the two way door and come back, so the one way doors, you gotta, you gotta make sure you got it right. So, if there’s a big investment in a massive platform that you’re a big IT transformation multi year, you’re going to want to measure twice, cut once, and make sure you do your.. that’s likely a one way door, or a very expensive two way door. So, you kind of have to run there. But I like that concept of.. and I use it with my team as well. Is this a two way door? Like, can we just move fast here, and then reverse it if we get it wrong, versus, oh, if it’s really a one-way door, you got to put enough in there to make sure that you’re comfortable with the with the impact of the decision,
Liz Farr
exactly. And I like that way of looking at things, that you know, yes, indeed, committing to Caseware rather than Engagement, that’s a big decision, and it’s not something that you know that the way they work is so different, so I. If you want to commit to Caseware then that means that’s what you’re doing, so yeah, I do like that concept, the one way door and the two day two way door,
David Marquis
right? Yeah, absolutely,
Liz Farr
yeah. Now accountants often know what they need to change, you know, they know they need to adopt AI, they know they need to be more tech centric, but what are the things that block them from making those changes?
David Marquis
Yeah, we’ve talked a bit about this. I think it comes down to culture, right? Culture is probably the biggest barrier. Accounting is a profession, values consistency, risk management, and you know that can make larger scale change feel uncomfortable. Trust is another challenge where firms need confidence in these AI systems that are reliable and governed and fit for purpose, like I mentioned. So, and many organizations are operating in these kind of fragmented technology environments that make transformation difficult, and so the technology itself is advancing rapidly, and in many cases the greater challenges is helping organizations kind of redesign those processes and adopt new ways of working, so I think, yeah, I think it’s a combination of things, but it’s mindset and culture, I think largely as well, around like, hey, let’s be innovation, let’s be tech forward, let’s be, you know, tech forward, let’s try to, let’s try to move a bit faster here, and you know, even if it’s a question of degree, let’s try to get folks moving towards an outcome a little bit faster than than we have in the past,
Liz Farr
yeah, yeah, yeah, and with the rate of change, you know, we’re in an exponential rate of change era, so this is the slowest rate of change that we will see in our lifetimes.
David Marquis
Yeah, I like that. I also use with my team, because we’ve been really blown away by just the excitement and the and the and the power of say our Verity product or any of the kind of AI imbued solutions that are coming up, coming out of the for the industry, and one of the things I say is, hey, this product, as amazing as it is, is the worst that it’s ever going to be, because the underlying technology improvements in that, that in the intelligence layer of the AI trust stack, and you know, Verity is built on, you know, frontier models that are going to continue to improve, and so, as amazing as the products are, they’re the worst that they’re ever going to be, and so that’s just kind of framing it up using the same concept around, wow, the future is going to be an exciting place, and we’re only just getting started
Liz Farr
exactly now. As you were talking about the tech being the worst today than it will be in the future, I had a flashback to my first time using Excel right out of college in the late 80s on a Macintosh, and how clunky and cumbersome that was, especially compared to today,
David Marquis
right? But at the time, you probably thought it was amazing, right?
Liz Farr
Yeah, yeah, it was. It was amazing that you could do all this data manipulation with this, it was just amazing.
David Marquis
Yeah, think about that. Think about from where that moment to Excel now to AI, and then imagine, okay, we’re at this moment where AI is in that initial Excel on the Mac, and where it’s going to go in the next 5-10 years, it’s just.. it’s mind-blowing. It’s going to be.. it’s going to be a wild ride.
Liz Farr
Yeah, yeah. Well, speaking of wild rides in the future, where do you see the accounting industry in 10 years?
David Marquis
Right. Oh, well, it’s going to be interesting. I’m genuinely optimistic about where the profession is headed, and I want to say that clearly, because there’s, you know, been a lot in the space around AI and professional services, maybe a little bit of anxiety, but I’m highly optimistic. I think, in 10 years the accounting profession is going to be more valuable, not less. The work that AI can’t just simply can’t do: professional judgment, ethical reasoning, client trust, the ability to interpret complex situations, and advise on what they really mean in the governance, like a human in the loop. Governed way, that work is going to be more important, not less, in a world where the routine has been automated. That’s that’s truly my belief. And so, what I think changes, you know, within that is how the work actually gets done and what the profession may look like. So, the leveraged model we’ve talked about a little bit around, you know, what these accounting firms are going to, are going to look like, and how many junior staff versus senior staff. I think that might change a little bit, you know, AI might affect the shape of these firms, but as I said before, I don’t think it’ll affect, you know, the value that folks can, humans, that professionals that are doing the work can add in the, in the, in the space, and I think it’ll allow them to actually get learn faster, get smarter faster, be more effective faster, and compress their learning cycles, and you know, I think that’s going to really help everyone. Yeah, and I think in a world, if I take a step back, and in a world where there’s more data, there’s more complexity, there’s more capacity, right, in terms of, you know, really understanding what the, what the truth is, the need for trusted, independent professionals who can make sense of that complexity and provide assurance in a framework that’s like really solid and trusted and refined over time, I don’t, I think that need doesn’t diminish. If anything, it’s going to grow, and so in 10 years I see a profession that has gone through significant and maybe some uncomfortable transformations along the way, but one that has come through with a clear sense of its own value, a more sophisticated relationship with technology, and actually a more important role in the economy than it has today, which is already very significant.
Liz Farr
Well, I love your very optimistic and progressive take on things, and what you, you said echoes what a lot of my other guests have said about the human element that will endure, and how technology will allow us to magnify what we as humans do. It’s not replacing us, but it’s allowing us to do more of what we do best. So I think that that’s a very exciting time for us.
David Marquis
Yeah, I certainly know for myself, you know, I use it all the time just to help as an advisor, as something that helps me get work done. I’m not even sure what word to put on it again. It just seems magical, and you know, I.. it helps me be a better leader and a better person too. I use it for my personal life as well, as my.. as a father of three and a husband, and everything else. it’s. I’m optimistic that we’re all going to benefit from this technology. Certainly, teaching my kids how to use it, because I think it’s going to be really important for their futures as well.
Liz Farr
I agree with you 100% and I think that’s the perfect note to wrap up our conversation on. Now, I want to thank you so much for taking the time to be on the show. Now, if listeners want to connect with you, where is the best place to find you?
David Marquis
Sure, sure, the best place, probably LinkedIn. You’ll see I’ve been publishing a number of posts on what we’ve been talking about today, so on AI, on what’s the importance in professional services, the concept of the AI truck trust stack, what the transformation is going to look like for the profession, and so I try to write in a way that’s useful for practitioners and not just technology people, so hopefully, hopefully that helps, and folks like it. Beyond that, I would encourage anybody who wants to go deeper on these ideas or our offerings, come to Caseware.com We’re having conversations with firms every day, and genuinely believe that the professions that are really interesting inflection point, and that we want to be a part of figuring out what comes next together with firms, with professionals and with that optimism around how how the future looks, so thanks a lot, Liz, for the time today. I really appreciate it.
Liz Farr
Well, it’s been a great honor and great pleasure to have you here. Now, I hope I look forward to sometime when we can meet in person at some conference,
David Marquis
I’m sure we will definitely. It sounds like you’re at many conferences throughout the year, as I’m, as am I. So, yeah, we’ll make sure to cross paths.
Liz Farr
Okay. Well, thank you very much. And I hope you have a wonderful rest of your day today.
David Marquis
You too.
Liz Farr
Bye now. Bye.