The AI Advantage: A Toolkit for Insolvency Practitioners

I was asked to consider doing a post on Artificial Intelligence (AI). There’s so much already out there, so I decided to ask ChatGPT to “write me an interesting post targeted at a professional audience about the impact of AI to the insolvency and restructuring sector.”

This is what it came back with:

Title: "Harnessing the Power of AI in the Insolvency and Restructuring Sector"

In the dynamic landscape of insolvency and restructuring, the need for speed, accuracy, and foresight is paramount. As we navigate through transformative times, it is critically important to leverage cutting-edge technology to stay ahead. One such game-changer is AI, which has been making waves across various sectors and has now set its sights on insolvency and restructuring.

AI's impact on the insolvency and restructuring sector has been profound, influencing both the process and the outcome. It has revolutionised the way professionals approach problems, make decisions, and execute strategies.

1. Efficiency and Accuracy: AI algorithms can rapidly analyse vast amounts of data, with precision, to identify patterns or trends that may be overlooked by human analysis. In the insolvency sector, this ability can be harnessed to predict financial distress, enabling early intervention and potentially avoiding insolvency altogether. 
2. Due Diligence: The due diligence process in insolvency and restructuring can be a time-consuming task. AI has shown promise in automating these processes, effectively reducing the time spent on mundane tasks while ensuring thoroughness and accuracy.
3. Predictive Modelling: AI's predictive capabilities offer a forward-looking approach, which is vital for the restructuring process. It can help in creating restructuring scenarios based on a range of variables, thereby aiding in the decision-making process.
4. Risk Assessment: AI can effectively assess risk and provide alerts about potential insolvency threats based on patterns in financial behavior. This can significantly improve the decision-making process and strategic planning in insolvency and restructuring.
5. Legal Analysis: AI tools can also help in analyzing legal documents quickly and accurately, thereby speeding up the insolvency and restructuring process.

While AI has undeniably reshaped insolvency and restructuring practices, it’s essential to note that it is a tool to aid professionals, not replace them. The human touch in decision-making, empathy, and ethical considerations are irreplaceable and remain at the heart of this sector.

Embracing AI and its potential can result in more effective insolvency and restructuring processes, providing a fast, efficient, and proactive approach to financial distress. As we continue to develop and refine these technologies, the benefits will become even more pronounced, leading to a future where insolvency and restructuring are more manageable, predictable, and effective.

I thought this was pretty impressive. Impressive enough to publish. As AI  progresses, there's no doubt that it will become yet another valuable tool available to professionals.

AI won't eliminate jobs; instead, it will greatly simplify our tasks. It represents an evolution similar to the invention of the abacus, the calculator, the computer, and the internet. AI provides practitioners with an additional resource to utilise, enabling them to accomplish more in less time.

By the way, this post took about five minutes to prepare. 

The views expressed herein are those of the author(s) and not necessarily the views of FTI Consulting, Inc., its management, its subsidiaries, its affiliates, or its other professionals.

FTI Consulting, Inc., including its subsidiaries and affiliates, is a consulting firm and is not a certified public accounting firm or a law firm.