However, Table 4 highlights the journals specializing in improving and facilitating the research, education and practice of advanced information systems, cutting-edge technologies and AI in the accounting, information technology and management advisory system fields. The interdisciplinary conference proceedings focused specifically on technological innovation. This study adopts a hybrid methodology, quantitative and qualitative, combining bibliometric and code analysis (Cobo et al., 2011; Massaro et al., 2016). The first step to answering the three RQs was to create a review protocol. According to Hoque (2014) and Tranfield et al. (2003), authors should explain the entire review process to facilitate replication.
For instance, Moll and Yigitbasioglu (2019) and Zemánková (2019) state the use of algorithms could provide efficiency by reducing repetitive action for accountants and auditors. In this sense, Tan and Low (2019) suggest that accountants obtain new skills to manage and understand technology needs. Much time has passed since Nakamoto’s (2008) white paper on blockchain’s first cryptocurrency application. Almost 12 years later, the uses of blockchain are innumerable and involve different business sectors. Its effects and benefits have also been studied by accounting, auditing and accountability literature.
- We argue that in the future, researchers should investigate the sustainability and environmental issues related to blockchain in more detail.
- It also guarantees that the record cannot be manipulated—no one can change the record.
- The insights provided into this emerging technology will have implications for the accounting ecosystem–some beneficial, others challenging.
They may also help journal editors decide on calls for special issues as interest in this topic grows. How cryptoassets and cryptocurrencies should be taxed is also open to question (Ram, 2018). Once clarified, researchers will be able to study the taxation policies applicable to this new class of assets in detail. One related research question for the future involves whether blockchain-based instant tax allocation helps to decrease the cost of tax compliance for companies or not (Karajovic et al., 2019). As the role of external contexts and legal frameworks is highly important to blockchain development (Allen et al., 2020; Stratopoulos and Calderon, 2018), researchers may study the differences in blockchain implementation in environments that are (and are not) “crypto-friendly”. Thus, the uncertainty on measuring cryptoassets leads to the problems of comparability, verifiability, timeliness and understandability in financial accounting (IASB, 2018, p. 6).
When Chartered Accountants Save The World
The adoption of blockchain technology along with artificial intelligence technologies and, more specifically, machine learning is happening at a fast rate. For example, blockchain technology will record that you bought something with 1 bitcoin. However, accountants can’t see whether it’s a car or even that you categorized your assets correctly.
- Ripple, a blockchain technology company, collaborated with financial institutions to streamline cross-border payments.
- At its core, blockchain operates as a distributed ledger shared among participants, each possessing a copy of the entire chain.
- To enforce tax compliance in relation to exchanges of cryptocurrencies, authorities could regulate these exchanges in the same way as they do the banking system and give to the central banks law enforcement power (Volosovych and Baraniuk, 2018).
- Today, we are racing toward yet another inflection point that holds tremendous promise and potential for the future of audit.
(2018), “Auditing with smart contracts”, International Journal of Digital Accounting Research, Vol. The results of Table 4 allow us to confirm our choice of the topics for further analysis. The top 10 papers with the highest citations per year belong to one of the four research topics that have the marginal distribution over 10% represented in Table 2 and account for more than a half of the overall distribution. Figure 1 demonstrates that the volume of articles on the topic is increasing annually.
A Primer on General Ledgers and Double-Entry Accounting
Monitoring what happens in real time rather than testing (selectively) and reconciling what happened in retrospect is a substantial departure from contemporary audit techniques. Some authors (Chang et al., 2019; Kumar et al., 2020) suggest that future supply chain systems will be your digital assets formed through integrations of blockchain into current systems, and a hybrid system with public on-chain data and private off-chain data will be used. Furthermore, major complementarities emerge between blockchain and RFID (van Hoek, 2019), IoT and ERP (Kayikci et al., 2022).
They play a crucial part in ensuring the accuracy of data entered into the blockchain and validating the authenticity of transactions. As gatekeepers of financial integrity, accountants will continue to uphold their responsibilities while adapting to the new tools and techniques introduced by blockchain. As the worlds of blockchain and accountancy converge, the potential for enhanced accuracy, reduced fraud, and increased efficiency becomes increasingly evident.
Why a career in chartered accountancy?
Blockchain has gained a lot of traction despite being a polarizing technology and an elusive concept for many. Sign up for weekly professional and technical updates from PICPA’s blogs, podcasts, and discussion board topics by completing this form. Acumen Analytics, based outside Philadelphia, helps organizations combine innovation with technology to improve and accelerate outcomes. As shown in the graphic below, the next stages on the hype cycle for blockchain are the slope of enlightenment and the plateau of productivity. Francesca Dal Mas has a bachelor’s and a master’s degree in Business Administration from the University of Udine, Italy, a law degree from the University of Bologna, Italy, and a PhD in Managerial and Actuarial Sciences from the Universities of Udine and Trieste, Italy.
Financial Services
Additionally, it is also a starting point for professionals to fully understand blockchain’s characteristics and potential with a constructive and systemic approach. It will be important to monitor the progress in the take-up of blockchain in the future (Bonsón et al., 2019; Gietzmann and Grossetti, 2019; Bonsón and Bednárová, 2019). More papers applying machine learning techniques will help to gather information from reports, and web crawlers will be able to discover new aspects of how blockchain technologies have been implemented in practice.
For example, well-developed IT competencies may become a prerequisite for the accounting profession, at least in the interim period where firms are prepared to face the changes brought about by integrating blockchain (Uwizeyemungu et al., 2020; McGuigan and Ghio, 2019). It will take time before companies implement blockchain as a ‘foundational technology’, and any disruptions to the profession will take place over years (Iansiti and Lakhani, 2017, p. 4). The main advantage of blockchain technology is that once a transaction is approved by the nodes in the network, it cannot be reversed or re-sequenced. The inability to modify a transaction is essential for the blockchain’s integrity and ensures that all parties have accurate and identical records.
Artificial intelligence has the potential to address these issues in a systemic and comprehensive manner if accountants are flexible enough to adopt these tools. Drilling back down to real world applications, however, provides an example of how these implications are already influencing accounting at large. Blockchain in accounting will help accountancy firms and accounting professionals, particularly auditors, with business audits. Since a large part of audits is verifying the occurrence and accuracy of financial records, this would free up a lot of time for the accounting professional to focus on other things. Blockchain creates a digital ledger of “blocks” that record transactions across many computers. Participants in the chain can verify and audit transactions independently, and relatively inexpensively, since any block in the chain cannot be altered.
The nodes also work in the same direction and are validated by the network’s other components (Rien Agustin and Susilowati, 2019). Additionally, Arnaboldi et al.’s (2017) contribution stimulates the conversation between academics and accountants considering business processes and digital interactions identifying, for example, the role of big data information and decision-making processes. Section 2 describes the current literature and why bibliometric analysis using open coding methods may facilitate our research aims. Moreover, section 5 provides an in-depth data interpretation, comments and critique on the main findings. Finally, section 6 concludes with a summary of the current state of the art and suggestions for future research.
It’s immutability and decentralized nature make it unique, but its function of recording transactions makes it familiar to those in the accountancy profession. Developing professional knowledge and understanding of this emerging technology and its applications will be crucial to ensuring the profession’s relevance and future readiness. Our analysis reveals that more than two-thirds of the papers under review were published in journals, while less than a third represent works in progress uploaded to SSRN. The top accounting journals from the ABS and ABDC rankings appear to be resistant to the blockchain field of research, as they have published only a few papers devoted to the technology.
The objective is to support cooperation among systems to permit a transfer of assets from one blockchain system to another despite differences in system interfaces, language, and execution platform. With all this are sidechains, a blockchain ledger that runs in parallel to a primary blockchain. Entries from the primary blockchain can be linked to and from the sidechain, allowing the sidechain to operate independently of the primary blockchain. Sidechains are frequently used in the context of private consortium blockchains.
