Abstract

Technological breakthroughs in automation and artificial intelligence, as well as its

implementations, have begun to reshape our universe, moving us closer to the predictions of

renowned futurists such as Jules Verne and Isaac Asimov from decades earlier. Because of

technological advancements, certain facets of our lives are transforming. The “artificial vs. human

intelligence” controversy, which is intensely discussed by scholars and professionals, covers a

wide range of contentious topics such as the potential opportunities of certain professions, the

requisite new skill set, and key competencies, and how humans and computers could collaborate

effectively and efficiently. The accounting profession is already on the verge of undergoing a

significant transformation in terms of the part it plays in organizations and the roles it conducts.

Advocates including its artificial intelligence movement see this as a positive step forward and

look forward to the opportunities that lie ahead. Opponents, but on the other side, see it as a

setback, claiming that more accounting professionals would struggle to respond to the new market

world and fall behind. This study attempts to describe a number of the current issues facing the

accountancy profession, as well as any potential future developments in its growth in the sense of

artificial intelligence. From the viewpoint of emerging intelligent systems and their industrial uses,

some assumptions about the accounting profession can be drawn. In addition, financial accounting

consumers in the modern world are going to change; they prefer accounting information

immediately after a business incident happens, rather than through a time lag. These reforms will

have an impact on how accountants perform their duties, necessitating the acquisition of new skills,

particularly in technology, which, ultimately, will result in new categories of accounting

practitioners.
Introduction

Artificially intelligent (AI) technologies are already so popular that we can scarcely envision our

existence without them. Auto cars are becoming a reality. Our mobile phones also recognize faces,

full sentences while texting, and provide verbal advice (Makridakis 2017). Indeed, AI has made

enormous progress thanks to the untiring efforts of computer programmers. AI is developing

thanks to intelligent systems and massive data science, with Bright Blue to Webb to AlphaGo and

DeepMind. Centered on the concept of "programs writing software," these last-generation systems

will teach itself (Parloff 2016, p. 3). AI systems in the field of accountancy have a long tradition

dating back to the 1980s. Scholars and practitioners published comprehensive studies on the use

of AI in audit procedures, tax, financial reporting, managerial accounting, and individual economic

planning. The implementation and application of intelligent systems (ESs) in financial reporting

is perhaps the most researched subject (Baldwin, Brown & Trinkle 2006). ESs are automated

programs that aim to mimic the behavior and experience of human experts, which attempts to

address financial difficulties and execute certain accounting activities by storing human

information and expertise and transforming it into law (Suton, Holt & Arnold 2016). For the study

of accounting-based admissibility, several ESs have also been formed (O'Leary 1987). According

to O'Leary (2003), earlier ESs didn't measure up to conceptual expectations because they'd been

based in fact, unless guidelines, and decision trees. Since they are incapable of learning, they can

keep making the same mistakes (Makridakis 2017). Aside from such early, also crude, efforts at

optimization, accounting professionals have always been eager to increase the quality and efficacy

of their jobs and provide more value to companies. Recent technical advancements in AI are

already opening up a new chapter in the professional accountants, concentrating studies from ESs

technologies to several new insights for professional accountants: how would accountants’ profit
through the use of AI technology, and what's the lengthy outlook for AI and financial accounting,

and how can AI alter accountant positions in the organization (ICAEW 2017). This latest wave of

machine learning techniques has a significant influence on economics and industry, but it also has

modern adventure and sociocultural consequences. One of the obvious consequences is a rise in

unemployment (Dirican 2015), and accounting professionals must be prepared to face all of the

problems of the AI movement.

Problem Statement

Artificial Intelligence (AI) programs will eventually replace accountants in several of their most

repetitive tasks because they are quicker and much more reliable than humans. Despite becoming

a significant thread in terms of unemployed, there is a good chance of increasing the

unemployment rate for accountants for artificial intelligence (AI) (Stancheva, 2018). Therefore, it

needs to be justified to demonstrate how artificial intelligence is causing job losses and how

artificial intelligence is benefiting humans. There has been little development in studies on how

artificial intelligence will take the position of humans.

Research question

1. What is the trend of using artificial intelligence in the accounts sector?

2. Is there any relationship between Artificial Intelligence and the unemployment of the

accounting sector?

Objective

1. To analyze the trend of using artificial intelligence in the accounts sector.

2. To find out whether there is any relationship between Artificial Intelligence and

unemployment in the accounting sector.

Future scope of the study

To provide an optimistic future outlook, we must first gain a thorough understanding about how

artificial intelligence can address accountancy and financial issues, as well as the realistic

difficulties and expertise required by accounting professionals to stand collaboratively artificial

intelligence. Accounting functions necessitate some in-depth analysis in order to differentiate

between routine and non-routine tasks. In the present risky and uncertain environment, further AI

applications for accounting and financial verdict must be studied in order to get a more reliable

impact of Artificial Intelligence in Accounting.

Literature review

AI is described as “algorithmic structures that aim to imitate forms of human knowledge” (Seshia

et al. 2016), which is the concept of a computing system possessing human-like intellectual ability

in order to understand, resolve issues, or make decisions. The idea dates back to the early 1950s

(Kiruthika and Khaddaj 2017), first emerging in books and movies and being a true part of

everyday life, albeit perhaps not in the manner the videos depicted. That's in self-driving vehicles,

robotic support staff like Cortana, and an AI computer also won a quiz show (Jeopardy!) (Hawking

and colleagues, 2014). Accountants use their advanced accounting and finance skills to assist

companies and clients in making smart decisions. Accounting professionals need elevated financial

and non-financial data and research to validate their selection and advice. This is expressed in a

broad range of accounting positions in industry and practice, which include capturing, preparing,

checking, and communicating reports, conducting research, and making a number of theories

(Kontzer 2015). Including their claims against with the threats acquired in Artificial intelligence,

Stephen Hawking, Elon Musk, and Bill Gates are perhaps the most quoted notable men today. We

can't ignore their dire predictions of humanity's demise. Several of their supporters contend that
the dystopian crisis is present, and also that people will be replaced by robots in the not-too-distant

future. They will make smarter, quicker, and more objective choices. It seems that the “singularity,”

the point at which AI surpasses human intellect, is the beginning of humanity's doom (Faggella,

2016). (Sulleyman, 2017), and individual projects for such individuals must be devised. The main

issue, in his view, is that the mechanism of labor displacement is extremely rapid and destructive.

Such AI views are shared by Rob Enderle, a well-known Tech Industry analyst who serves on the

Futurologist Panel as well as the Socioeconomic Factors Committee of the non-profit Lifeboat

Organization. According to a few Organization's three examples, AI will eventually take over all

human work, resulting in "world economic disaster, civil war, starvation, and the like" (Kontzer

2015). However according neoclassical theory economic theory, technology has a positive impact

on employment because it increases company competitiveness by shifting labor habits and creates

new job prospects and styles of workers (Mensel & Tholl 2017). However, these hypotheses were

unable to understand the Great Depression of the 1930s, especially its devastating effects on jobs.

The widely held belief at the time that full employment is automatically created by free market

self-balancing processes was unable to explain the global economic crisis. The World Financial

Crisis of 2007-2008 ushered in a new era in Keynesian thinking. According to Harvard professor

N. Gregory Mankiw, who wrote for both the Wall Street Journal, John Maynard Keynes seems to

be the only economists who can assist us appreciate the latest fiscal problems. (Mahmud, Jahan,

and Papageorgiou, 2014). Joe Stiglitz, a Nobel Laureate in Economics, concluded in 2014 that

inventions create an economic illusion. People who have lost their jobs or had their wages reduced

as a result of economic advancements are unable to save money and reduce their spending on

commodities, resulting in deflation. According to a McKinsey Global Institute study, each

distinctive work task necessitates a mix of 18 output skills, which are classified into five
classifications: visual comprehension, domain knowledge, language processing, emotional and

social functionality, and physical strength. Among the most important skills is technological

competence in artificial intelligence, and the breadth of experience needed is determined by the

organization's scale, investment policies, and organizational innovation. Regardless of such

considerations, accounting professionals must realize the importance of data consistency. Machine

learning entails recognizing and applying patterns based on actual data sets or instances,

developing one's own algorithms, and improving them over period (Shimamoto, 2018). Both

young and inexperienced accountants are required to be innovative with data and generate valuable

insight, thus helping by predicting future expansion, emerging businesses, or competitiveness

(King 2014). AI research is currently focusing on developing technologies that can perceive and,

if it is not smarter than, individuals, like intellect and logic (Kiruthika and Khaddaj 2017). This is

accomplished by designing algorithms that "teach" computers to understand by utilizing a network

of instruction, historical, and variable amount. All trends that the machine learns are saved, and

when similar conditions occur in the future, the device uses its understanding of a passing there

had worn to make the correct choice (Kiruthika and Khaddaj 2017). There have been four modes

of AI, which is now being mentioned: established facts, cognitive intuition, and cognitive

interaction. The primary possible advantage of AI in the corporate world, and one mostly likely to

affect auditors, is based assessments (also known as robotic process automation), which includes

invoice management (Castelluccio 2017). This would have an effect on many occupations in the

field, including accounting professionals, so it is critical that accounting professionals use their

technical abilities and inquisitive disposition to question and help develop a platform of

technologies to the corporate world in such a reasonable and ethical manner. It would longitudinal

fibers technological expertise, as well as teamwork and collaboration activity on the portion of the
accounting, in order to create and sustain connections between technology and information experts

mostly on one side and the corporate community from the other (Crookes and Conway, 2019)

Methodology

Sample and Sampling Strategy

This research is focused on the service and production sectors of some of the leading corporations

that are heavily using AI in their organizations. The research would use data from sixty

Internationally listed firms as a sample. Annual reports of sample firms are chosen to gather all

applicable data and annual reports are regarded as a credible source of knowledge by investors

worldwide (Raman, 2006; Adams, 2004). The research uses a comparison of five fiscal years from

2016 to 2020 to assess if Artificial Intelligence has any impact on the corporation's unemployment

rate.

Primary data

For this research, questionnaire was developed to collect primary data, which is deemed suitable

because it demonstrates the desired results and is acceptable for the studied population. According

to Kent (1993), the benefits of using questionnaires include the questioner's ability to monitor the

order and applicability of queries. Thus according Sekaran and Bougie (2010), the first benefit of

using a survey is that the completed answers can be generated in a limited amount of time.

Secondary data

The source of secondary data is

1. Organization’s websites.

2. Previous research.

3. Organizational manuals.
4. Newspaper/ tech trend magazines.

Selection of Variables

This section of the thesis outlines the significance of the variables used in the analysis and how

they were determined. The degree of Artificial intelligence using content analysis has been

measured based on some concepts applicable to accounting environmental data. Researchers used

a different checklist of items to compile accountant environmental data. Unemployment will be

measured by Cognitive capabilities, Productivity growth, Key factors influencing the pace and

extent of automation and Effects on employment are selected as independent variable and

dependent variable is artificial intelligence.

Model Specification

The fitted regression model for the study is as follows,

AI= a0 + a1COG + a2POG + a3FIP + a4EXA + a5EOE

Dependent Variable

AI= Artificial Intelligence

Independent variables

COG= Cognitive capabilities

POG= Productivity growth

FIP= Key factors influencing the pace

EXA= Extent of automation

EOE= Effects on employment

Analysis and finding

Due to reduced consumer demand, capital owners are less likely to make acquisitions that generate

new jobs. Makridakis (2017) posed a fundamental question about the part individuals will perform

in the coming years following AI replaces, supplements, and/or amplifies the roles humans actually

perform during work. Frey and Osborne's (2013) study focus on the US labor market and aims to

determine how vulnerable workers are to computerization. They identified three computerization

bottlenecks and linked them to 9 observable variables that describe the amount of awareness and

coercion, imagination, and social awareness needed to perform a job. More interestingly at first

glance, accounting professionals are in the high-risk band, with a chance of computerization in the

near future of 0.94. (p. 69). These findings differ from those of Baldwin, Brown, and Trinkle, who

conducted research a few years earlier (2006). In addition to their main target, Frey and Osborne

looked at how incomes and educational achievement affect the likelihood of a job being

computerized. Their results revealed that they have a deep negative correlation. The survey results

model expected a change in the labor market polarization pattern toward computerization being

restricted to low-skill, low-wage employment. Frey and Osborne's (2013) findings and patterns

were supported by Knowles-Cutler, Frey, and Osborne (2014), who used the same strategy and

methods to apply their research to the UK labor market. According to their estimates, 35% of UK

employees are at significant risk of computerization. A fascinating conclusion concerns future

preparation and upskilling of the existing workforce. According to the authors, the educational

system must respond to the evolving environment by developing the most effective instructional

techniques to meet the need for workers with "creative, technical, and Silicon Valley talents" who

can quickly turn occupations (Knowles-Cutler, Frey & Osborne 2014, p. 20). In this sense, it is

only natural to inquire about the potential opportunities of the accounting and reporting
occupations, which are considered risky. They do need imaginative and emotional creativity to

execute some of the job functions, but thanks to the immense advancement of AI technology, a

number of repetitive tasks can be computerized. A significant research project, for example,

resulted in the identification of over 400 independent audit activities. Many of them have been

deemed unsuitable for Artificial intelligence since they are defined as less formal and dependent

on ambiguous and insufficient information (Abdolmohammadi, 2018). Despite these efforts, the

accountancy profession faces a marginal risk of increasing unemployment due to the complexities

of the business environment and the value of accounting knowledge for management decision-

making. This is due to the increased degree of computerization of the job activities.

Conclusion

Without a doubt, artificial intelligence is reshaping the landscape of many professions, including

accounting. When approaching ai technology as a supplement to human intelligence, several new

possibilities for key positions and employment arise. The possibility of labor disruption seems to

be something of a hypothesis than a potential prospect, and we are witnessing a transition away

from questions about accounting work automation and toward the professional accountants

accepting AI capability for its advantages. Accounting activities are being more integrated with

group managerial activities. Since artificial intelligence (AI) is influencing and will continue to

influence the profession of accountant, there is indeed a call for educational institutions to change

their approach and learn the necessary skills and competencies relevant to smart technology and

their automated business applications. There is also much effort to be done to revise accounting

teaching methods and train graduates for promising careers. Accounting experts are also

confronted by AI questions throughout the accounting domain because they must work with AI
professionals to overcome the current distance between the accounting and AI domains. More

sophisticated AI implementations can be created to completely solve certain financial difficulties.

Fuzzy rule - based and impartial systems were two fields of AI technology that could be effectively

implemented in the accounting sense (Baldwin, Brown & Trinkle 2006). There are also significant

concerns concerning accounting regulations and benchmarks bodies, as well as the growing need

for institutional resources. Because of the uncertainties involved with AI implementations,

policymakers must understand the effect of emerging technology on financial reporting

requirements as well as the visibility of data outputs produced through machine learning

techniques. One potential and ideal outcome is for regulatory to promote, if not force, the use of

intelligent technology in accrual accounting, and their thorough knowledge of AI as well as the

costs involved with it must be established (ICAEW 2017).

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