THE INTEGRATION OF ARTIFICIAL INTELLIGENCE IN FINANCIAL AUDITING: CHALLENGES OF LEGAL COMPLIANCE AND ADHERENCE TO PROFESSIONAL ACCOUNTING STANDARDS

Abstract

This study aims to examine the integration of Artificial Intelligence (AI) in the financial audit process, as well as the emerging challenges related to legal compliance and professional accounting standards. A descriptive qualitative approach was used through interviews with an auditor at a public accounting firm in Surakarta and literature studies. The results indicate that AI offers significant opportunities to enchance efficiency, accuracy, and audit coveragec especially in detecting anomalies and processing large-scale data. However, AI lacks profesional judgement. Moreover, legal regulations governing AI usage are still unclear. Therefore, regulators need to provide legal certainty to protect auditors who utilize AI.