Unimpeachable 10 Commandments 2.0
Unimpeachable Neutrality in the Age of Artificial Intelligence
The world of economic damage and business valuation is evolving rapidly, with artificial intelligence (AI) poised to become an indispensable tool for financial expert witnesses. As with any technological advancement, its use and implementation with regards to expert opinions, conclusions, and testimony must be handled with unimpeachable neutrality, a hallmark of credibility in the courtroom. This 19th article of the Unimpeachable Neutrality Series explores how financial experts can integrate AI into their practice while maintaining unimpeachable neutrality, integrity, reliability, and professionalism.
The world of economic damage and business valuation is evolving rapidly, with artificial intelligence (AI) poised to become an indispensable tool for financial expert witnesses. As with any technological advancement, its use and implementation with regards to expert opinions, conclusions, and testimony must be handled with unimpeachable neutrality, a hallmark of credibility in the courtroom. This 19th article of the Unimpeachable Neutrality Series explores how financial experts can integrate AI into their practice while maintaining unimpeachable neutrality, integrity, reliability, and due diligence.
I: Thou Shalt Use AI as a Tool, Not a Substitute
Financial experts must remember that AI is a tool, not a substitute for expert judgment. AI can analyze massive datasets with unprecedented speed and accuracy, but it lacks the capacity for human judgment, intuition, and the nuanced understanding of context that is critical in legal settings.
As experts, we must remain the decision-makers. The numbers that AI produces, while potentially invaluable, are not an end in themselves. They are one part of a larger mosaic, and it is the expert’s responsibility to interpret these findings in a way that adheres to the facts of the case, economic realities, and legal precedents. AI-generated insights must always be cross-validated by human expertise to ensure unimpeachable testimony is delivered in court.
II: Thou Shalt Ensure Transparency in AI Usage
Transparency is essential when incorporating AI into financial analysis and expert testimony. One of the greatest risks in relying on AI is the “black box” problem, where the mechanics behind the analysis are opaque even to the expert deploying it. Financial experts have a duty to ensure that any AI models used in their analyses are transparent, explainable, and replicable.
In testimony, this means explaining not only what the AI found but how it arrived at those conclusions. Financial experts who fail to explain how AI reached its conclusions may undermine their credibility, violating the fundamental principles of transparency and replicability demanded in expert testimony.
III: Thou Shalt Guard Against Bias in AI
AI, while capable of reducing human error, is not immune to bias. The data fed into AI models directly influences their outputs. If this data is incomplete, inaccurate, or skewed, the AI’s conclusions will reflect these flaws.
The financial expert witness must ensure that AI uses high-quality, relevant data sources and that any inherent biases in the data are identified and mitigated. The expert should never present AI findings as infallible but as part of a larger, more nuanced analysis.
IV: Thou Shalt Use AI as a Supplement, Not as a Replacement
The application of AI in business valuation can revolutionize the field by aggregating and analyzing financial data at speeds that outpace traditional methods. However, predictive models built on AI are inherently speculative and are only as good as the assumptions underlying them.
In valuation, experts must always supplement AI insights with traditional valuation methods, such as the income, market, and asset-based approaches, ensuring that the testimony is balanced, impartial, and defensible.
V: Thou Shalt Prepare for Cross-Examination of AI Use
No discussion of unimpeachable neutrality would be complete without addressing the crucible of expert testimony: cross-examination. AI’s introduction into testimony invites scrutiny. Opposing counsel may question the AI’s reliability, transparency, or potential biases.
Experts must be prepared to defend the AI’s findings, discussing how it was used as a supplement to human expertise. Financial witnesses must emphasize that they guided the AI’s analysis and interpreted its outputs in a way that aligns with their expert knowledge.
VI: Thou Shalt Not Misrepresent AI as Infallible
AI offers potential, but financial experts must use it ethically. This includes ensuring that AI’s results are presented accurately and resisting the temptation to over-rely on AI to bolster testimony. An expert’s role remains to provide an objective and fair analysis rather than to use AI to mislead or manipulate.
VII: Thou Shalt Continuously Develop Competence in AI
AI and Automated Valuation Models (AVMs) are complex tools that require specialized knowledge. Financial experts must continuously develop their competence in AI technologies, ensuring they understand not only how these tools work but also how to apply them effectively within their scope of expertise.
Maintaining professional competence through ongoing education is essential to adhering to the high ethical standards required in expert testimony. Financial experts must stay updated on AI’s evolving landscape and the implications for business valuation and economic damage.
VIII: Thou Shalt Exercise Due Professional Care with AI Outputs
Due professional care requires that AI and AVM outputs be thoroughly validated and tested for accuracy. This means financial experts must not rely on AI-generated outputs without verifying their credibility through traditional means. This practice ensures that AI models comply with both the NACVA standards and the court’s expectations for accurate and reliable testimony.
Documentation is also key. Experts must meticulously record the AI tools used, methodologies, and assumptions made to allow for comprehensive review during litigation.
IX: Thou Shalt Acknowledge AI’s Scope Limitations
It is critical to recognize the limitations of AI and AVMs. For example, AI models may not capture sudden economic shifts or regulatory changes that impact business valuations. AI must be used as a supplement rather than a replacement for other valuation methods, and experts must clearly define the scope of AI’s application in each assignment.
Transparency regarding the assignment’s limitations prevents the expert from over-relying on AI, thus ensuring unimpeachable neutrality.
X: Thou Shalt Integrate AI into a Comprehensive Analysis
While AI offers insights, financial experts must ensure that these tools are used as part of a broader, fundamental analysis. This holistic approach, which integrates both AI insights and traditional methodologies, ensures that experts remain neutral and comprehensive in their testimony.
In litigation engagements, AI must not replace the rigorous analysis expected by courts but should complement it, enhancing the expert’s overall credibility.
Conclusion: A Future of Opportunity and Responsibility
AI offers exciting opportunities for financial expert witnesses in the realms of business valuation and economic damages. However, as with any powerful tool, its integration into expert testimony must be handled with care, responsibility, and unwavering commitment to unimpeachable neutrality.
By approaching AI as a supplement to—rather than a replacement for—professional judgment and by ensuring transparency, bias mitigation, and ethical usage, financial experts can harness the potential of AI while preserving the trust foundational to their role. The unimpeachable expert witness must remain both a master of traditional methodologies and a steward of emerging technologies, navigating the future with impartiality and integrity that has long been the hallmark of the profession.
Zachary Meyers, CPA, CVA, is the managing member of C. Zachary Meyers, PLLC specializing in litigatory accounting and valuation services. He has been retained in over 2,900 matters since 2011, as a testifying expert, consulting expert, or neutral/court appointed expert qualified in forensic accounting, business valuation, pension valuation, and taxation. Mr. Meyers has held multiple influential roles on national and international standard setting bodies, where he has made significant contributions to the financial disciplines at the highest levels of the National Association of Certified Valuators and Analysts (NACVA), Global Association of Certified Valuators and Analysts (GACVA), and The Appraisal Foundation (TAF).
Mr. Meyers can be contacted at (304) 690-2619 or by e-mail to czmcpacva@czmeyers.com.
