Effects of artificial intelligence on financial reporting accuracy
PhD Student in Accounting and Finance, Institute of Distance Education, University of Zambia, Lusaka Zambia.
Research Article
World Journal of Advanced Research and Reviews, 2024, 23(03), 1751–1767
Article DOI: 10.30574/wjarr.2024.23.3.2791
Publication history:
Received on 03 August 2024; revised on 11 September 2024; accepted on 14 September 2024
Abstract:
Intelligence (AI) has emerged as a transformative force in modern financial reporting, promising to revolutionize accuracy and efficiency across various industries. This study delves into the effects of AI on financial reporting accuracy, addressing critical questions surrounding its implementation, challenges, and best practices. Through a comprehensive investigation, the research aims to provide valuable insights to guide organizations in leveraging AI effectively while maintaining the integrity of their financial reporting practices. The main objective of this study is to explore the effects of artificial intelligence on the accuracy of financial reporting, examining both the benefits and challenges associated with its integration into organizational processes. Specific Objectives; To analyze how various AI technologies influence the accuracy of financial data and reporting in organizations, to explore the challenges and limitations faced by organizations when integrating AI into their financial reporting systems, to assess the importance of human oversight in ensuring the accuracy of AI-generated financial reports, to develop best practices for organizations to enhance the accuracy of financial reporting when using AI technologies. This study employed a mixed-methods approach, combining qualitative and quantitative data collection techniques to comprehensively explore the effects of AI on financial reporting accuracy. Quantitative data was gathered through surveys distributed to accountants, finance professionals, auditors, and personnel from manufacturing and tourism sectors across various industries. The surveys focused on assessing perceptions of AI's impact on financial reporting accuracy and included Likert-scale questions to gauge agreement levels. Qualitative data was obtained through in-depth interviews with selected participants to gain deeper insights into their experiences and perspectives regarding AI technologies in financial reporting. Thematic analysis was applied to interview transcripts to identify recurring themes and patterns related to AI's effects on accuracy. Participants were informed about the study's purpose and their rights, including confidentiality and anonymity. Informed consent was obtained prior to data collection, ensuring ethical standards were adhered to throughout the research process. Survey responses indicated a generally positive perception of AI's impact on financial reporting accuracy, with a majority of respondents acknowledging improvements in efficiency and error reduction. However, challenges such as data security concerns and the need for skilled personnel were highlighted as significant barriers to AI integration. Human oversight emerged as a crucial factor in validating AI-generated outputs, emphasizing the complementary role of human judgment alongside technological advancements. The findings underscored AI's potential to enhance financial reporting accuracy through advanced data analytics and automation. Key recommendations include investing in comprehensive training programs for staff, integrating AI with human expertise, implementing robust data governance frameworks, conducting regular audits of AI systems, and engaging stakeholders throughout the integration process. In conclusion, this study provided valuable insights into how AI technologies can improve the accuracy of financial reporting while addressing challenges and emphasizing the importance of human oversight. By adopting recommended best practices, organizations can maximize the benefits of AI in financial reporting, paving the way for more reliable and informed decision-making in the digital age. This research contributes to the growing body of knowledge on AI's impact on financial practices, offering practical recommendations for organizations aiming to leverage technology effectively in their financial reporting processes.
Keywords:
Artificial Intelligence; Financial Reporting; Accuracy; Technology Integration; Data Analytics
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Copyright © 2024 Author(s) retain the copyright of this article. This article is published under the terms of the Creative Commons Attribution Liscense 4.0