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Link: The future of financial analysis: How GPT-4 is disrupting the industry, according to new research | VentureBeat

Researchers from the University of Chicago have demonstrated that large language models (LLMs) can conduct financial statement analysis with accuracy rivaling and even surpassing that of professional analysts. The findings, published in a working paper titled “Financial Statement Analysis with Large Language Models,” could have major implications for the future of financial analysis and decision-making. The researchers tested the performance of GPT-4, a state-of-the-art LLM developed by OpenAI, on the task of analyzing corporate financial statements to predict future earnings growth. Remarkably, even when provided only with standardized, anonymized balance sheets, and income statements devoid of any textual context, GPT-4 was able to outperform human analysts. “We find that the prediction accuracy of the LLM is on par with the performance of a narrowly trained state-of-the-art ML model,” the authors write. “LLM prediction does not stem from its training memory. Instead, we find that the LLM generates useful narrative insights about a company’s future performance.” #


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