Auditors can redirect their efforts towards analyzing complex data patterns and making strategic recommendations, enhancing the audit’s value. However, challenges exist, including the need for standardization, data privacy considerations, and adapting to the technical complexities of blockchain. As the technology matures and industries embrace its potential, the integration of blockchain into accounting practices promises to streamline processes, enhance data accuracy, and ultimately elevate the trust and reliability of financial reporting. In the realm of modern finance, blockchain technology has emerged as a transformative force, redefining the landscape of accounting practices. Blockchain’s decentralized and tamper-resistant nature holds immense potential to revolutionize traditional accounting systems.
- Routine accounting data would be recorded permanently with a timestamp, preventing it from being altered ex-post, which Alles (2018) argues would further ensure the reliability of current accounting information systems.
- However, the recent past and the near future of blockchain are firmly anchored to the development of financial instruments and cryptoassets (second cluster).
- But this, the whole, what is probably higher on the hype cycle right now is stablecoins.
- McCallig et al. (2019) propose a blockchain system that overcomes the privacy issues the use of multiparty security and modular arithmetic.
- Here, we searched for “accounting” AND “blockchain” or “accounting AND distributed ledger” over the same period and found 68 papers, some of which overlapped with papers already retrieved.
Although blockchain technology has been around for decades, there has been a strong uptick in developers and adopters in the space. Many experts believe we are years away from mainstream adoption, while others claim with the advent of AI and ML, the prospect of blockchain technology will be exponential. But what can we do as individuals and as organizations to prepare for a change in “the way we work”?
3 Methods of analysis: Latent Dirichlet Allocation combined with manual analysis
For example, according to Kokina et al. (2017), one of the first research problems concerns accounting data ownership and transparency in their decentralization. Besides, blockchain’s characteristics and definitions in this area are unclear (Kokina and Davenport, 2017; Schmitz and Leoni, 2019). Still, few studies question which theoretical areas of accounting blockchain are persisting (Bonsón and Bednárová, 2019). These critical issues flourish as we face this new and interdisciplinary research topic driven by exogenous forces inherent in society. Guthrie et al.’s (2019) commentary reflections cite Roos’s (2015, p. 49) opinion that, in the next 10–15 years, we will see changes driven by technology, creating opportunities and threats that will require new and curious approaches from researchers. The literature review reveals a pressing need for legal frameworks to govern blockchain technologies and regulate cryptoassets.
In the accounting professions, these elements are overcome through the method identified by Rozario and Vasarhelyi (2018). The first focuses on blockchain and its technological features strictly related to decentralized platforms, such as Ethereum, used to share peer-to-peer smart contracts. This section identifies the most cited authors for the accounting, auditing, accountability and blockchain fields, analyzing whether they are scholars, practitioners or both. It also identifies the authors’ keywords, their dominance factor (DF) ranking and the total number of citations. This paper provides a compact snapshot of the state of blockchain papers in accounting research.
- Several authors combine blockchain with auditing and control systems, applying it to different business functions.
- Each transaction is recorded as a digital signature and is nearly impossible to alter due to cryptographic hashing.
- Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee (“DTTL”), its network of member firms, and their related entities.
- Thus, few authors have demonstrated the role of blockchain in sharing both financial and environmental data.
However, in the absence of these forms of investor guarantees (involved intermediaries), Giudici and Adhami (2019) found that fundraising success depends on a project’s team and the advisory committee’s reputational capital at stake. According to Gan et al. (2021), the critical success factors in this context are the existence of a liquid secondary market, a minimum price-cost ratio of 2, a critical mass condition and the establishment of a maximum number of tokens. Gonzalez (2020) shows that peer-to-peer (P2P) lending decisions are influenced by the gender of borrowers and herding behavior.
1 Dataset creation
They bring together authors who currently appear to support blockchain and others who consider the technology harmful to accounting and auditing work. Starting from reports by professionals and literature, they focus limitedly on governance, transparency and trust, continuous audits, smart contracts and accountants and auditors’ roles in the emerging blockchain ecosystem. Each of the papers on this topic discusses ideas about how the role of accountants and accounting treatments would change if/when blockchain becomes a mainstream technology.
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Free and Hecimovic (2021) outline the situation of the post-COVID-19 supply chain. Among the research agendas, an interest in new blockchain-related studies emerges. Finally, albeit in a different scope, Kotb et al.’s (2020) structured literature review examines research related to artificial intelligence (AI), paving the way for an open discussion on the effects of technology. Unless existing processes and systems are truly scrutinised for their potential to benefit from blockchain technology, the full range of opportunities that blockchain presents will not be realised. Blockchain will only become a “game-changer” if all parties involved in the accounting ecosystem are open to its potential.
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As with any profession, expertise is what accountants get paid for, and now, such expertise will be needed more than ever to analyze financial results rather than focusing on the mundane tasks of reconciling and verifying transactions. Analysing the role of blockchain in changing business models in different industries is sure to be a topic of great interest to researchers (Johannessen, 2013). The efficiency of new business models in comparison to traditional ones may also bring new insights for academics and practitioners. Researchers should test new business models in a market and evaluate transaction efficiency and the degree of novelty in the transaction’s content, structure, steering, resource use, network effects and value creation for stakeholders.
As suggested by the authors, future research works could deepen the investigation field, leading to additional keywords and results. First, in line with Garanina et al. (2021), Mancini et al. (2021), Lombardi et al. (2021) and Secinaro et al. (2021), the research on blockchain in accounting studies is primarily qualitative. Contrary to other studies, our SLR was updated at the beginning of 2022; therefore, it includes the most recent literature reviews published on the topic. However, especially in light of other SLRs on similar topics, we see an opportunity to perform future in-depth analyses to test new methods, including empirical and quantitative methods. Blockchain’s integration into accounting heralds a transformative era for financial processes. Its tamper-proof ledger ensures data accuracy, reducing the likelihood of errors and fraudulent activities.
The decision to vote at the shareholders’ meeting based on blockchain technology leads to numerous challenges, especially accounting and auditing. The second strand of research is based on verification and possible processes based on public or private blockchain, which companies could use to share audit firms’ audit processes. A distinct research strand looks at intelligent contracts and accounting operations. Besides, the research flow also shows interest in the accounting implications of cryptocurrency.
Similarly, Bonsón and Bednárová (2019, p. 737) conclude that “blockchain is an under-explored phenomenon, [and] future research is necessary to obtain a full understanding of this emerging technology and its implications for the accounting and auditing sphere”. The sources studied indicate theoretical implications for 47% of the cases, mainly in future research. This is in line with the poor theoretical analysis of blockchain in this research area.
All this will help to improve transparency further and decrease information asymmetry in the market. However, the skills required of accountants are likely to change, and there may be a need for fewer entry-level accountants (Kokina and Davenport, 2017; Marrone and Hazelton, 2019). There may be a shift towards notions such as creativity, innovation, holistic thinking, complex decision-making and sense-making. The ability to adapt to keep pace with an increasingly evolving business environment and technological context will also be important. Addressing such changes in education through content and delivery is necessary to ensure that graduates have up-to-date and workplace-relevant knowledge and can keep up with global accreditation standards and professional qualifications (Al-Htaybat et al., 2018). Teams, management and government bodies implementing blockchain and making decisions based on data obtained from blockchain will also need new skills to adapt to the changing environment (Pimentel et al., 2019; Siew et al., 2020).
Finally, for coding analysis, we use the Deedose web application particularly suitable for ensuring that the inter-rater reliability (IRR) links with the degree of consistency in how the code system is applied (Talanquer, 2014). In the next subsection, we provide how much does a cpa cost an analytical description of the coding framework adopted. Blockchain is one of the most disruptive digital technologies (Carson et al., 2018; Ruzza et al., 2020), and interest in its applicability and effects has grown both from practitioners and academics.