Chapter 9: AI-Driven Financial Reporting: Integrated Financial Reporting in Emerging Economies

This study addresses a critical gap in the literature by systematically reviewing research on how artificial intelligence (AI) adoption influences the quality of Integrated Financial Reporting (IFR) among listed firms in emerging economies. It builds on the premise that AI enhances the effectiveness, accuracy, and transparency of IFR. A systematic literature review (SLR) was conducted using Scopus and Web of Science. Forty-one peer-reviewed articles meeting predefined criteria were analyzed to extract insights on AI adoption and its impact on IFR, with an emphasis on firms in emerging markets.

Results reveal a significant positive relationship between AI adoption and IFR quality. Firms with greater AI integration demonstrate more transparent reporting practices. This link is reinforced where firms engage specialized auditors and incur higher audit fees, suggesting a synergistic effect between AI and audit quality. Moreover, AI’s impact is more evident in firms without financial restatements, highlighting its role in enhancing reporting accuracy and reliability.

The findings guide executives, auditors, regulators, and policymakers. They support investment in AI and underscore the need to pair AI tools with high-quality audits to maximize reporting integrity. Regulators are encouraged to create frameworks for responsible AI use, while firms can leverage AI to reduce restatements and strengthen compliance. By focusing specifically on AI’s role in IFR quality within emerging economies, this study contributes novel insights. It highlights the moderating roles of audit quality and restatements, positioning AI as both a technological enabler and strategic asset for advancing financial reporting standards.