The Muamalat Newsletter Vol. 2 2023

Introduction In the world of finance, accountants play a pivotal role in ensuring that the financial information of businesses and organizations is well-organized and makes sense. They take the raw numbers, like income, expenses, and investments, and transform them into coherent financial reports and statements. Thinkofthemasthearchitectswho design the blueprint that helps everyone understand how well a company is doing financially. As the financial landscape changes over time, there’s a growing need for greater efficiency and a deeper understanding of these numbers. Businesses want to make smarter decisions, investors want more insight into where they should put their money, and regulators want to ensure everything is transparent and fair. This is where artificial intelligence (AI) steps in. AI is like a super-smart assistant that canprocessmassive amounts of data much faster than humans. It canquickly spot patterns, trends, and anomalies in financial data that might take accountants a long time to identify. AI doesn’t get tired, and it doesn’t make human errors, which makes it incredibly valuable in handling complex financial information. Imagine a future where AI takes care of the repetitive and time-consuming tasks that accountants often have to do, like sorting through thousands of invoices, checking for errors in spreadsheets, or reconciling accounts. This would free up accountants to focus on more strategic and valuable tasks, like advising businesses on financial decisions or providing insights into how they can improve their financial health. This transformation is not just a dream; it’s becoming a reality. Many companies and accounting firms are already using AI- powered tools to streamline their financial processes and provide more valuable insights to their clients (Gambhir and Bhattacharjee, 2021). So, as AI continues to advance, it’s likely that the role of accountants will evolve, allowing them to become even more valuable assets in the world of finance. The Rise of AI in Accounting To understand the present and future of AI in accounting, we must first glance back at its evolutionary journey. The roots of AI in accounting can be traced back to the advent of computers in the mid-20th century. Early accounting software aimed to automate basic calculations and data entry, heralding a new era in financial management. However, it wasn’t until recent decades that AI, equipped with machine learning capabilities, began to truly transform accounting processes. The ability of AI systems BeyondThe Ledger: DecodingThe FuturewithArtificial Intelligence in Accounting 17 FEM eNewsletter | Dec 2023 Authors: Nur Hidayah Laili and Khairil Faizal Khairi Faculty of Economics and Muamalat , Universiti Sains Islam Malaysia