Checking AI output: competence, due care and R320.11.
AI tools produce confident, well-formatted answers, and some of them are wrong: a tax position that misreads a ruling, a summary that drops a schedule, a reference to a determination that does not exist. APES 110 does not ask accountants to avoid AI. It asks them to decide when relying on it is appropriate, and since 1 January 2025 it says so in terms.
General information only. This guide summarises published professional standards and legislation and is not legal or professional advice. Read the primary sources linked throughout, and take advice on your firm’s specific position.
R320.11: using the output of technology
The technology-related revisions APESB issued in June 2024 added a requirement for members in public practice. When a member intends to use the output of technology in a professional activity, R320.11 requires the member to determine whether that use is appropriate for the intended purpose. The application material at 320.11 A1 lists the factors to consider:
The nature of the activity performed by the technology, and how far the work will rely on its output.
Whether the member, or an expert the member can access, can understand, use and explain the technology and its appropriateness for the purpose.
Whether the technology has been appropriately tested and evaluated for the purpose, and whether its use for that purpose is generally accepted.
The firm’s oversight of the technology’s design, implementation, operation, monitoring and updating.
The controls over its use, including procedures authorising user access and overseeing that use.
Whether the inputs are appropriate, including the data and the decisions people make while using it.
Section 320 sits in Part 3, so R320.11 applies to members in public practice; Section 220 carries the same factors for members in business. For a firm, it makes adopting an AI tool a documented decision about fitness for purpose, made before anyone relies on the output.
Subsection 113: competence and due care
R113.1 requires members to attain and maintain professional knowledge and skills at the level required to deliver competent professional activities, and to act diligently in accordance with applicable technical and professional standards. The application material at 113.1 A3 says maintaining competence requires a continuing awareness and understanding of technology-related developments relevant to the member’s work. Two further requirements matter for AI:
- Supervision (R113.2). Members must take reasonable steps to ensure those working under their authority have appropriate training and supervision. A graduate using AI to draft a review note is still working under someone’s authority.
- Limitations (R113.3). Where appropriate, members must make clients aware of the limitations inherent in their professional activities and explain the implications. Where AI materially shapes a deliverable, its limits may be among them.
A verification workflow that holds up
Totals, balances and dates in an AI summary go back to the workpaper or statement they came from before anything relies on them.
Rulings, determinations and section references are confirmed in the ATO legal database or the legislation itself, never taken from the AI’s answer alone.
The reviewer needs the competence to spot what is wrong. AI output reviewed by someone who could not have produced it has not really been reviewed.
Note on file what the tool did and who checked it. If the work is questioned later, that note is the evidence of due care.
Where deployment posture fits
No architecture removes the duty to check. Two things make checking faster: answers that show the source excerpts they drew on, and a tool that works from the firm’s own files instead of the open internet. Every answer from an Ermos unit carries the excerpts behind it. Deployment also bears on several R320.11 factors directly, because an on-premise unit puts oversight, access controls and inputs inside the firm, where the member can see them. Our page on tax research shows how this works in practice.
Common questions
What does R320.11 of APES 110 require?
Do accountants have to check AI-generated work?
When did the technology revisions to APES 110 take effect?
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