AI Revolutionizes Accounting and Legal Sectors, Firm Expands to Cebu
Artificial intelligence (AI) is fundamentally transforming the fields of accounting and legal practice, automating routine tasks and compelling firms to enhance staff skills, according to a senior partner at Camara, Custodio & Co. CPA lawyer Mark Darwin Camara highlighted that AI has reached a level of efficiency where it can manage basic bookkeeping functions, including transaction recording and data encoding—tasks traditionally handled by dedicated encoders within accounting firms.
Automation and Efficiency Gains
Camara explained, "Previously, we required three encoders per team. Now, often one encoder suffices because AI assists with fundamental recording and data input. This shift enables our certified public accountants and senior associates to concentrate on more intricate analysis and advisory responsibilities." He emphasized that as AI tools advance, they may eventually interpret Philippine tax regulations, further simplifying compliance processes. However, he urged professionals to embrace rather than resist this technological evolution.
"Avoidance is not an option. You must learn to integrate AI into your practice," Camara stated, noting that automation boosts efficiency and enhances competitiveness for both accounting and legal firms.
Strategic Expansion in Cebu
Camara and fellow senior partner CPA lawyer Niersen Custodio have recently extended their Manila-based firm, Camara, Custodio & Co., to Cebu by establishing an office on Don Mariano Cui Street in Fuente Osmeña, Cebu City. This expansion aligns with Central Visayas' robust economic performance, driven by factors such as:
- Infrastructure development
- Renewable energy investments
- Tourism recovery
- Manufacturing growth
- Information technology-business process management
- Logistics and shipbuilding
The firm operates under an integrated model that combines certified public accountants and lawyers on a unified professional platform. This structure is designed to assist businesses in navigating complex tax, regulatory, and compliance landscapes. Camara noted that the Cebu expansion aims to support enterprises, particularly small and medium enterprises (SMEs), as they scale up amid the province's economic momentum. These SMEs often need structured financial reporting systems, tax compliance guidance, and legal advisory services during formalization and growth phases.
Comprehensive Service Offerings
By consolidating audit, tax advisory, litigation support, and corporate finance into one coordinated framework, the firm provides end-to-end services, including:
- Tax compliance and audit defense
- Representation before the Court of Tax Appeals
- Forensic accounting and fraud investigation
- Estate valuation and settlement support
- Corporate finance advisory and transaction valuation
- Regulatory and commercial law compliance
Additionally, the firm holds accreditations from the Board of Accountancy for public practice, the Cooperative Development Authority, and the National Electrification Administration, enabling it to serve specialized institutions like electric cooperatives alongside private enterprises. This expansion occurs as businesses adapt to evolving Bureau of Internal Revenue audit guidelines and enhanced transparency measures, such as revised procedures for Letters of Authority and system-assisted audit selection processes.
Compliance Challenges for SMEs
Despite technological advancements, Camara pointed out that tax compliance remains a significant hurdle for many SMEs, often due to systemic and documentation issues rather than intentional evasion. He estimated that out of 100 taxpayers, most strive to comply, with only a minority deliberately underreporting income. However, complications arise when businesses procure materials from unregistered suppliers or fail to obtain proper documentation.
"For instance, if a business purchases goods worth P100,000 from an unregistered supplier lacking proper invoicing, it becomes challenging to declare the full cost for tax purposes," Camara elaborated. "This impacts how income and expenses are reported." He also observed that in some smaller cities and provinces, businesses operate without necessary permits or Bureau of Internal Revenue registration, creating compliance gaps.
Camara described the Philippine tax code as "highly complex," noting its similarity to the U.S. system and the need for both accounting and legal expertise to fully interpret it. "It requires a CPA and even a lawyer to grasp the full regulatory implications," he said. "Not all SMEs can afford such expertise." To mitigate cost concerns, the firm offers fixed monthly retainers instead of hourly billing, making professional services more accessible to SMEs and individual professionals.
Future Growth Prospects
Since initiating its legal practice in 2013, the firm has grown to serve over 100 SME clients. Camara revealed that the company is exploring expansion into other developing cities with rising business activity. "We are targeting the next cities experiencing significant business growth," he said, indicating ongoing regional expansion plans.
