The Terminator in the Kitchen: How Robots are Changing the World of Fast Food

As we continue to digest the impact of ChatGPT on the world of work, CNBC had an interesting video on how robots are ready to replace humans in the kitchen:

As noted in the report, the industry is poised to save $12 billion in labour costs by replacing "up to 82% of restaurant positions... by robots." The video also highlights the safety benefits that could accrue to fast-food workers with the use of robots. Coincidentally, I was chatting last week with a barista at Starbucks. He mentioned an unfortunate incident where his friend fell into an oil vat while cleaning the equipment. This was not at a small restaurant, but a major one. Finally, the video speaks to the labour crunch that the industry is facing. With over half a million positions to be filled, robots could be the answer restauranteurs are looking for. 

Other advantages include the following:

• Improved hygiene: Given the impact of COVID-19, many people now view the idea of reducing human involvement in food preparation as a way to ensure a more hygienic end product.
• Consistency: By using robots for food preparation, restaurants can ensure that customers receive consistently high-quality food. This can avoid dissatisfied customers, who have had to consume burnt offerings!
• Reduced food wastage: Systems can be designed to avoid food wastage and capture excess toppings, etc., to be reused. 

In terms of cost, Miso rents these out:

"Miso’s flashiest invention is Flippy, a robot that can be programmed to flip burgers or make chicken wings and can be rented for roughly $3,000 a month."

What I found fascinating was how we have been preconditioned by sci-fi movies to expect humanoid robots. Instead, we find an awfully familiar-looking contraption: a rail-car system with a camera and mechanical arm attached. It's pretty similar to what we have seen before in terms of how robots are being used to make lattes, as discussed in this post. 

But there is more to the contraption than ‘meets the eye’. The value ultimately is in the software that can bring all the moving parts together. As noted by Mike Bell, CEO of Miso Systems, who manufactures the "frying robot" (taken from the YouTube transcript): 

"The hard thing to get right about this product is having the computer vision, the algorithms that plan the cook cycle and the software that manages the robotic motion to all work together so that it's as reliable as a refrigerator and it does the job."

In conclusion, the food industry is looking to save billions of dollars in labour costs by replacing restaurant workers with robots. Though this would save mountains of money we need to look at the society wide impact of such a monumental shift. Personally, working in the fast food industry as a young person taught me a lot before entering the CPA profession, such as the importance of hard work, humility, and empathy. Without such work, where would the youth of today or tomorrow learn such basics? Only time will tell what this means for the future generations that don't have access to such formative experiences.

Author: Malik Datardina, CPA, CA, CISA. Malik works at Auvenir as a GRC Strategist that is working to transform the engagement experience for accounting firms and their clients. The opinions expressed here do not necessarily represent UWCISA, UW, Auvenir (or its affiliates), CPA Canada or anyone else

RPA and the Accountant: A path out of the mundane?

One of the latest hype technologies is Robot Process Automation (RPA).

My first question when coming across this, is what is the difference between this and cognitive computing? 

As can be seen by these videos, it's more about "dumb" automation instead of "smart" innovation: where routine tasks are handled by the system instead of a person. This is in contrast to something like IBM's Watson, which attempts to understand language and offer probabilistic judgments as to what is the right answer to a question like it did on Jeopardy!


The first video (produced by Deloitte UK) does a great job of actually showing us how RPA can automate the process of extracting information/documents from email and the generating invoices through the company's ERP:

The strength of this video (produced by EY) is showing us the business case for RPA:

The idea is that RPA can automate routine tasks, instead of offshoring. In other words, it brings the world of automation onced reserved for the assembly line to the back office.

As described in this Deloitte publication, it puts RPA as the first step towards a cognitive enterprise - automate the task and then bring cognitive, AI, machine learning, etc., into the process to make it smarter.

To use a maturity model approach, RPA is the first level in bringing together the necessary data and processes to actually train the algorithm to make it smarter.

What does this mean for auditors and accountants?

For accountants, the back office is going to require less people in terms of executing these mundane tasks.

However, this doesn't necessarily mean that jobs will be lost.

As with the advent of cloud computing, the enterprises will have to determine whether such talent can be used more effectively to improve the quality of financial reporting and work on the back log of finance projects that haven't been attended due to staff working on these low-value tasks. That being said, the problem of meeting quarterly targets to feed investors insatiable desire for profits is something that can't be ignored when discussing whether management will choose profits over better processes.

For auditors the story is a little different.

The reality of the profession is that it can't retain talent because people find the work unsustainable: it's hard to shutdown your personal life for a third of the year or more to meet the needs of clients during busy season.

RPA and automation could make the profession more sustainable, as these mundane tasks could be handed to a system instead of a junior. This is similar to the "race with the machine" concept I mentioned in this post, when referring how Watson is helping doctors treat cancer.  Auditor could then focus on more value added tasks, such as assessing aggregate risks, industry trends, etc. Such insights will improve audit quality and give clients better understanding of business and audit risks, making the work more interesting for both auditors and auditees alike.

Author: Malik Datardina, CPA, CA, CISA. Malik works at Auvenir as a GRC Strategist that is working to transform the engagement experience for accounting firms and their clients. The opinions expressed here do not necessarily represent UWCISA, UW, Auvenir (or its affiliates), CPA Canada or anyone else.

GoldmanSachs on Blockchain: Insights into Audit & Accounting Automation

As noted in this Business Insider article, Goldman Sachs (GS) published a report on blockchain that identifies a number of scenarios where the technology can save billions. The BI article extracted the following use cases from the 88 page report:

• Better authentication of individuals partaking in the sharing economy: Leveraging the "smart identity" functionality of the blockchain, peer-to-peer sharing businesses sites (e.g. Airbnb) can give both the customer (e.g. the renter) and the supplier (e.g. the home owner) greater assurance that the customer is really who they say they are. The GS report also links the identity to smart contracts that facilitates automated performance based payments 
• Accounting system for renewable energy power generation: Where individual homeowners are generating wind or solar power, the blockchain can be the natural accounting system to manage the "debits and credits" transferred back and forth between the energy producer and the network. It also enables payment transfers as well. 
• Reducing back end administration for title insurance: The actual GS report notes how the vast majority of the cost associated with title insurance can be reduced by about 30% using blockchain to manage the underlying property records. Other interesting notes is that they attribute part of the decline to improved actuarial risk calculations due to "greater historical transparency". 
• Improving accuracy and timeliness of trading various securities: The financial services industry usage of the blockchain is quite straightforward - replace the chaotic world of spreadsheet accounting with the streamlined world of blockchain - it is a database technology after all. NASDAQ use of Linq was featured in this DUPress article and can also be found here. The GS report goes into much more granular detail as to the different scenarios on how the back-end system can be improved resulting in less verification issues and improved trading times.  
• Better authentication of customers aka KYC (Know-Your-Customer): As noted in the BI article, "Like with the Airbnb example, Goldman envisions identity data stored on a blockchain that could help finance firms easily and quickly check new customers as part of "know your customer" regulation — a bit like a digital passport."

I went through the long report and extracted the following accounting automation insights:

• Blockchains can reduce spreadsheet funk. Sharing spreadsheets has become the norm in the financial world for being a flexible way to send quantitative information along with context and some formulas here and there; it's how we auditors often get data from the client when asking for a breakdown of an account we are looking into as a part of the audit. It's also error prone. Blockchain, in a sense, is a "napster-esque" way of sharing financial information that ensures a common data structure between the sender and the receiver thereby eliminating the manual verification/handling of spreadsheets (see pages 3 and 10).
• Blockchain can enhance "assurance", where it's not feasible for auditors to do so. On page 16 the report discusses the role of smart identities in assisting the sharing economy. It talks about how required digitally signed user reviews will have greater data integrity as it could reduce the risk of self-inflated reviews. Although people rely on such reviews to buy books, rent hotels, etc., there is risk of fraud where the seller will inflate reviews or pay people to do so. However, with a blockchain enabled smart identity there's a higher level of assurance that the end-user can place on the reviews as it harder for the site owner to fake the reviews due to fact the review is digitally signed. Of course no audit firm would have audited such reviews. But I think that's the point: the blockchain technology fills an an assurance need that auditors couldn't, simply because the delivery of such a service wouldn't be profitable. 
• Blockchain automation will reduce the need for back-end clerical staff (aka accountants): When looking at the application of blockchain to the title insurance industry (see pages 33-39), it notes how 75% of the industry premiums relate to headcount costs. GS puts the reduction in clerical staff by 30% and a 20% reduction in variable expenses (e.g. commissions, marketing, etc.). Blockchain - without AI enhancements - will automate accounting work as part of the automating knowledge work trend. This is of course more clerical tasks, but blockchain will likely result in less headcount within the finance department. 
• Role for third party assurance reports in a permissioned blockchain: The consensus mechanism in the permissioned blockchain is quite different than it's public counterpart, which relies on the proof of work (POW). (See the Khan Academy video, below for the POW and the blockchain section in this post) This is not the case for permissioned system which require the consortium who set-up the blockchain to determine how they will work with each other. This could require auditors to provide assurance over the implementation of blockchain similar to what the SOC report does for cloud computing companies. The report discusses how (see page 29) on how the blockchain will enable "Smart Grid Blockchains" to essentially acts as the record keeping and payment system of energy exchanged by the household owner who has windmills, solar panels to the power grid. But how do we ensure that this being calculated properly? Well, that's where the Processing Integrity Principle of the SOC3 assurance report comes in. It could provide assurance that the blockchain-accounting-payment system is processing the data in complete, accurate and timely manner.  
• Greater visibility, means greater opportunity for audit analytics. One area of cost savings associated with a blockchain enabled title insurance industry is that actuaries will be better able to assess risk  because of "greater historical transparency and immutability into the property registration system" (see page 38). Consequently, where a material amount of transactions are on a blockchain auditors will have (1) easier access to the data (not a trivial matter by any means!) and (2) can run better analytics to identify irregular transactions and (3) enable better ways to assess estimates. 
• Value versus hourly billing: In a number of the use cases identified (e.g. title insurance, settling equities, KYC; see pages 38, 51, 75) noted how the gains (read: headcount reduction) from blockchain enabled automation are expected to be passed on to the customer. Why is this relevant to audit? Audit firms could be expected to hand over automation windfalls to the client and further reduce fees. On the one hand, the more automated the audit, the potentially less fees that audit will capture. On the other hand, regulators may want the auditors to do more with the budget that has been freed up. So the revenue, profitability of highly automated audits will depend on how the regulators re-draw scope in light of such advances. 

Despite having the reputation as a great-vampire-squid, the GS report is quite useful for those working in the blockchain space in identifying the potential for this exponential technology.

Author: Malik Datardina, CPA, CA, CISA. Malik works at Auvenir as a GRC Strategist that is working to transform the engagement experience for accounting firms and their clients. The opinions expressed here do not necessarily represent UWCISA, UW, Auvenir (or its affiliates), CPA Canada or anyone else

Cyborg are here! Well not quite, but this is amazing!

True there has been a lot of excitement around drones, driver-less cars and robotics more generally. Each of these technologies herald an exciting potential to automate and make efficient tasks that are mundane. Amazon, most famously, is looking to see how drones will enable them to deliver their packages use this technology - replacing their need for couriers with a 24-7 army of robots.

With all that amazingness, there is something yet even more amazing - cyborgs! Wall Street Journal posted the following video today:



The seamless integration of machine and man has been the focus of science fiction for decades. However, the founders of personal computers actually always had such a vision in mind. I have been going through the Master's Switch by Tim Wu, a really amazing book on how yesterday's tech-entrepreneur becomes today's tech-mogul-tyrant squashing innovation (this is definitely a topic for another blogpost) . In the book, he also discusses how Douglas Engelbart came up with the idea that computers can be tools to augment human intelligence. When you think about your relationship with your smartphone or laptop, it is something to augment your intelligence. With this development, however, it takes it to the next level: to actually augment and repair the human being.

Can one expect the development of super soldiers? That too has been the story behind science fiction, but I wouldn't discount such a possibility outright.