Expertax Applies Artificial Intelligence to Tax Problems

Article excerpt

Digging the two volumes of Internal Revenue Code out of his credenza, Larry Evans, tax partner in the Oklahoma City offices of Coopers and Lybrand, plopped the books on his desk.

"This is the code," he said of the nearly five pounds of text. He turned back to the same drawer and came up with nearly 11 more pounds of codes in four more paperback volumes.

"And here are the Treasury Department's regulations - their opinion - on the law," he said. Between the six volumes there are about 13,000 pages, and in the case of the regulations, updates and new opinions are issued constantly, adding more reading material, according to Edd Painter, tax supervisor in the Oklahoma City office.

Big Eight accounting firms like Coopers and Lybrand have to be experts on that information virtually overnight in order to serve clients well - to advise them on accounting methods, purchases and other tasks of the industry, Evans indicated.

That is one reason he is so excited about Coopers & Lybrand's new ExperTAX system - the first application of artificial intelligence in corporate tax planning and one of the most sophisticated in the entire financial arena, he said.

ExperTAX - a system that required an investment of more than $1 million and more than 7,000 hours of development - uses the knowledge of 40 senior tax and audit experts, according to David Shpilberg, director of Coopers & Lybrand's Decision Support Group. Shpilberg helped design the system, which has a knowledge base of more than 3,000 rules and functions as an intelligent questionnaire.

So, what kind of super computer does it take to run this artificially intelligent program?

"Most businesses have an IBM-PC/XT or compatible in their offices somewhere, so that's what it is designed to operate on," Evans said.

He stresses that the point is not to replace any employees, nor will the company gain fees from ExperTAX's use. And, it's not for sale.

"It's more of a quality enhancement program," he said.

"It's like having an expert at your fingertips, so-to-speak," said Painter.

ExperTAX's main application will be in the field with auditors. They will carry the floppy disk with them to assignments and collect data as always. …

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