The Impact of Blockchain and Artificial Intelligence on Accounting

Running head: ACCOUNTING THEORY
Accounting Theory
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ACCOUNTING THEORY
Artificial intelligence is referred to as technological intelligence that can be demonstrated
by the machines. It is of a great contrast with the natural human intelligence as its function and
behavior can be influenced as per the need. Therefore, it is issued by the enterprises to maximize
their organizational goals (Barnett & Treleaven, 2017). If the machines can be utilized
efficiently, they are capable of doing tasks that cannot be done by human beings moreover; it
reduces the time and saves money. Similarly, block chain that was invented by Satoshi
Nakamoto in 2008 is a technology that is devised as a digital currency or bit coin. It is a
language of programming that enables the users to make sophisticatedly make contracts and
creates accounts that pay themselves when share certificates and shipment arrives or, which
provides their owner dividends automatically if there is an achievement of a level profits.
According to Hood (2018) the concept of artificial Intelligence is one of the most
trending topics today, the practice of making machines that is capable of doing the tasks that
requires intelligence. As automation and digitization, influence more business processes, the
need increases to master emerging technologies. This will be key to professional success for
accountants, regardless of whether they work in public practice or private industry. Two of these
technologies—block chain and artificial intelligence (AI) has the potential to reshape the
profession of accounting. Here is a brief overview of what exactly these tools are, followed by
suggestions on how accounting departments can introduce them for smooth functioning.
Block chain is an accounting technology. It is concerned with the transfer of ownership
of assets, and maintaining a ledger of accurate financial information. The accounting profession
is broadly concerned with the measurement and communication of financial information, and the
analysis of said information (Baron, 2017). Much of the profession is concerned with
ascertaining or measuring rights and obligations over property, or planning how to best allocate

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financial resources. When it comes to accountants, the use of block chain gives a clear cut idea
of assets ownership and existence of obligations, and could enhance efficiency.
`The business potential for the technology is broad and deep. In the accounting
profession, block chain could have interesting implications for auditors. Due to block chain
technology's automated, real-time verification and enhanced security, auditors might not have to
spend nearly as much time on verifications, confirmation, and analyses of specific accounts.
Block chain could make audits considerably faster and less expensive to perform (Dai &
Vasarhelyi, 2017)).
Organizations of all types are using AI as a tool for accounting. It can helps to research
the applicable reporting codification or tax code line item. Many renowned organizations uses AI
for a variety of applications and tools real-time analysis of financial and operating performance
and fraud detection (Baron, 2017). AI can perform easily more routine tasks than that human
accountants can, therefore, it is a threat for the accountants will lose their jobs to software.
Block chain and AI is capable of benefiting the profession of accounting by decreasing
the maintenance cost, reconciling ledgers, and providing certainty of ownership and assets
history (Treleaven & Batrinca, 2017). They can help accountants gain clarity over the available
resources and obligations of their organizations, and also free up resources to concentrate on
planning and valuation, rather than recordkeeping.
Alongside other automation trends such as machine learning, block chain will lead to
more and more transactional-level accounting being done without the manual work of the
accountants. Instead, successful accountants will be those that work on assessing the real
economic interpretation of block chain records, combining the record to economic reality and