Prompting for Accountants

Imagine it’s mid-December, and your inbox is flooded with urgent client queries. One email stands out: a sole trader asks if they can defer their provisional tax payments due to cash flow issues. You need to check the Income Tax Act 2007 to confirm the rules around deferrals, but the deadline for filing is just two days away. As you scramble to find the right section in the legislation, you wonder if there’s a faster way to get accurate, actionable information without wasting hours sifting through legal texts.

This is a common scenario for accountants in New Zealand. With IRD deadlines looming, Xero and MYOB data to reconcile, and clients demanding clarity on GST, PAYE, and tax obligations, the pressure to deliver accurate advice quickly is immense. This is where well-crafted prompts can transform how you work - saving time, reducing errors, and improving client communication.

All company names and scenarios used in this course are fictitious and created for illustration and training purposes only. Any resemblance to real businesses or organisations is coincidental.

At the heart of effective AI use is the prompt - the question or instruction you give to an AI tool like Microsoft Copilot. A well-structured prompt includes four key elements:

1. Role: Who is the AI playing? (e.g., a tax agent, a compliance officer)
2. Context: What is the situation? (e.g., a client’s query about GST, a need to draft an engagement letter)
3. Task: What needs to be done? (e.g., explain the rules around provisional tax deferrals)
4. Format: How should the response look? (e.g., a bullet list, a summary paragraph, a legal citation)

Specificity is critical in accounting. Vague prompts like “explain tax rules” lead to generic, unhelpful responses. By clearly defining the role, context, task, and format, you guide the AI to deliver precise, actionable information tailored to your needs and the NZ regulatory environment.

Example: Tax Research Query

Bad Prompt: “What are the rules for provisional tax?”
Good Prompt: “Act as a tax agent. A client is asking if they can defer their provisional tax payments due to cash flow issues. Reference the Income Tax Act 2007 and provide a concise summary of the conditions under which deferrals are allowed.”

This structure ensures the AI focuses on the exact issue, cites relevant legislation, and provides clarity your client needs.

Example Prompts: Ready to Use

Here are 4 prompts you can copy and paste into AI tools today:

Prompt 1: Tax Research Query
”Act as a tax agent. A client is asking if they can defer their provisional tax payments due to cash flow issues. Reference the Income Tax Act 2007 and provide a concise summary of the conditions under which deferrals are allowed.”

Prompt 2: Client Email
“Act as a tax agent. Draft a client email explaining why their GST return is overdue and what steps they need to take to file it by the IRD deadline. Use plain English and avoid jargon.”

Prompt 3: Memo to File
“Act as a compliance officer. Write a memo to file outlining the steps required for a client to correct an error in their PAYE return. Include a reference to the Tax Administration Act 1994 and suggest a timeline for resolution.”

Prompt 4: Engagement Letter Clause
“Act as a legal advisor. Draft a clause for an engagement letter that outlines the client’s obligations under the Anti-Money Laundering and Countering Financing of Terrorism Act 2009, including identity verification and record-keeping requirements.”

These prompts are designed to save time, ensure compliance with NZ legislation, and deliver clear communication to clients.

Common Pitfalls and Misconceptions

1. Overlooking Legislation: Failing to mention relevant laws (e.g., the Privacy Act 2020 or Financial Reporting Act 2013) can lead to incomplete or legally risky responses. Always specify the legislation you want referenced.
2. Vague Formatting Requests: If you don’t tell the AI how you want the response structured (e.g., bullet points, paragraphs, or tables), you may get information that’s hard to use in your workflow.
3. Assuming AI Knows Your Context: AI tools don’t inherently understand the nuances of NZ accounting practices. You must explicitly define the context, such as whether you’re dealing with a sole trader, company, or trust.

Try This: A Practical Exercise

Step 1: Open Microsoft Copilot.

Step 2: Use the following prompt to generate a response:

“Act as a tax agent. A client is asking if they can claim a deduction for a home office used for their business. Reference the Income Tax Act 2007 and explain the conditions for eligibility. Provide a bullet list of requirements and an example calculation.”

Step 3: Review the response. Does it address the client’s query? Does it cite the correct legislation? Is the format easy to use?

This exercise helps you see how structured prompts can deliver precise, actionable information - even for complex issues like home office deductions.

Key Takeaway

Well-structured prompts are a powerful tool for accountants in New Zealand. By defining the role, context, task, and format, you can guide AI tools to deliver accurate, compliant, and client-focused responses. Whether you’re researching tax rules, drafting emails, or updating engagement letters, specificity ensures you save time, reduce errors, and improve communication. Start with these prompts today - and watch how AI becomes a practical ally in your practice.