Artificial Intelligence and Blockchain

This article discusses the impact of Artificial Intelligence and Blockchain on accounting. It explains how AI and Blockchain can benefit the accounting field and how they can be used to improve productivity and resource management. The article also discusses the security of the Blockchain system and how it can prevent manipulation of data. It concludes by stating that the development in technology has benefited accountants at large and that new and improved mechanisms can be used as a potent tool for the process of reporting.

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FINANCIAL ACCOUNTING THEORY & PRACTICE

Artificial Intelligence and Blockchain
AI and Blockchain can be tagged as a major landmark in the field of technology that has led to
various benefits. Both these topics have a very different meaning and the impact they put on the
daily life activities. Blockchain can be explaining as a form of a ledger, but more secured and
with a divided concept. A transaction held in a Blockchain is updated very quickly with the
transaction getting terminated as soon as it is finished. Using Blockchain relieves the
management of any outstanding transactions and the settlements are done on the go and very
quickly. This also prevents manipulation that could have been done with the earlier records and
data.
AI is a computer programming which can do the labor tasks that ease which would otherwise
require human help. Accumulation of data that is generally hard to be sort can be given to the AI
for performance results. AI can very effectively decrease the time required to do the same work
by humans for some days or a few hours that would require weeks to be done. As for now, it
would not be wrong to say that the AI would take more tasks upon itself as from the humans.
The accounting field has been using technology for quite a long time now and the use of an
effective AI would certainly bring a new phase for the standards and investments of the business,
which is always the main priority (Carusi & Jirotka, 2009). For acquiring, such levels the
management has to see that how the loopholes existing in the business can be treated with the
use of technology that will take the stakes higher. This can also prove to be a good potential test
for the AI systems.
Systems that are more intelligent enable completely different approaches to this ultimate
objective and the kinds of fundamental business problems the profession aims to solve. Investors
should have faith in the financial results of companies; companies and governments need to
ensure the correct levels of tax are paid; management to decide how to spend assets. Solving
these kinds of fundamental problems is essential for the companies (Hood, 2018).
As time passes by, the AI into the systems will evolve and will be able to ensure that the work
done is in coordination with the rules, regulations and other enterprise policies. Invasion of the
human privacy has also been a topic with the AI as thought by many people as they think that
human behavior, working skills, and patterns would be learned by the AI with its ‘machine
learning adaptive’ trick. Blockchain’s working can be thought of as a divide and rule concept
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Artificial Intelligence and Blockchain
associated with the ledger. In this system of working, each user can individually view, change
and log any recorded transactions (Hood, 2018). However, the ledger is not in the hand of one
person but all the users connected to the network. Any change made in the ledger will require a
permission grant by all the users connected and this is how the data is saved from being
manipulated and is totally secured. This system of working would surely effectively reduce the
enterprise cost and also the pressure to maintain bookkeepers and accountants.
The Blockchain system will surely cause an accounting market upset by its skills and will make
some professional services outdated. If a certain transaction is stored in Blockchain then it
cannot be manipulated. If it happens that any change is made then that particular change will be
visible to all the users and thus the data cannot be altered. This process of working makes
auditing simple and reduces the probability of any errors. Some of the workings of the
accounting will surely disappear but the removal or replacement of the auditors cannot be said.
Every transaction stored in the Blockchain is verified and is passed by both parties and so it
reduces the workload to store those transactions in two different ledgers maintained by the
parties. It also has a triple entry system wherein the transaction stored in stored in both the
ledgers and the stack of the Blockchain also.
Security of the Blockchain system is very tight and once the data is saved then it is impossible to
manipulate it. This is possible because of the strong encryption program stored at its base that
will not allow any data to be altered in any way without any type of authorization any without
any knowledge to the other users (Hood, 2018). To prepare for the Blockchain technology the
following must be undertaken
• The growth of the Blockchain is inevitable but the main question is when that will happen. So
it is advised by the auditors and management to become familiar with the working of the
Blockchain system.
• If someone’s business depends on accounting or auditing related fields then it is advised that
to invest and route the business to different directions that will incur more profit and all the data
and transaction will be kept up-to-date in the Blockchain smoothly. Accountants can come up
with new ideas and with the help of Blockchain; the business will reach extremely new heights.
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Artificial Intelligence and Blockchain
Blockchain has been totally approved and still some queries prevail about its usage and so the
auditors and the accountants all should contribute their ideas and views in the discussion so as to
drive a single movement (Tucker et. al, 2011). The accounting fields where AI and Blockchain
can be used are enormous and never-ending but all this will be good and up-to-the-mark as the
processes that prevail now (Rud, 2009). So it is advised that tally the previous data but in
accordance and respect with the AI and Blockchain which will provide a fair idea that how and
where their usage will help the team. AI is common and can be seen to be used in many big
enterprises (Barney & Ray, 2015). For example, the usage of AI would reduce so much work as
it would compile, analyze, and store all the documents and the user will only be left with the job
of decision-making.
It is no mystery that proper implementation of AI would result in improved productivity and
excellent resource management. Accountants all over the world are already using multiple
software tools from CRM systems to business process management tools, to make better-
informed decisions. Deloitte recently published an article that was quoted as ‘what artificial
intelligence can do that included the surplus resources and ways that are provided by this process
of work which can help the business to reach profitable heights and reduced the incurred costs
(Junk, 2015).
AI backed investment management or automated wealth managers are more likely to offer sound
financial advice without having to bring aboard a full-time advisor. The reactive cognition based
benefits of AI has piqued the interest of the global investment community as well. Bridgewater
Associates, one of the biggest hedge fund managers in the world, have already developed AI
backed trading algorithms, which are capable of predicting market trends based on historical and
statistical data (Azmi, 2011).
There have been many advancements and in the field of technologies that have a huge influence
in the field of accounting. The fields of accounts have been widely influenced by the web-
enabled communication, mobility and the cloud. This ascertains the fact that with the due
passage of time there will be more dependence on the software counterpart (Peter et. al, 2013).
The use of cloud technology is another important landmark in the field of technology that is
strongly embraced by the accountants (Barney & Ray, 2015). The major portion of the business
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Artificial Intelligence and Blockchain
operation is hosted in the cloud. The presence of such technology leads to greater cost benefits,
mobility, and agility in the IT infrastructure (Tsai et.al, 2011). The firms that will use loud have
more benefits as compared to other firms in terms of maintenance, updating, and other host
services. Such features will help in the field of accounting. Moreover, there are further choices
when it comes to the cloud platforms that are public, private, and hybrid. Public cloud is the
fastest cloud segment and dominated by Amazon, Google, and Microsoft (Ma, 2010). When it
comes to public cloud, the services are standardized and deliver relentless service who has the
same infrastructure. By using a private cloud service provider, the accountant can take advantage
of the IT resources that are shared across multiple applications. Hybrid is the combination of the
public and private cloud platform. It can be of immense use for expansion, however, in terms of
set up and operations it is potential to go wrong. It needs more downtime and the cost involved is
higher (Chugh & Ganndhi, 2013).
Hence, from the above discussion, it is seen that the development in the field of technology has
benefitted the accountants at large. The presence of new and improved mechanism can be used
as a potent tool for the process of reporting. As time passes by, there will be more changes
ensuring further positive impacts in the accounting field.
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Artificial Intelligence and Blockchain
References
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