As William Shakespeare said “It is not in the stars to hold our destiny but in ourselves”. Artificial Intelligence (“AI”) becoming the tool by which we shape the future in today’s world.
Artificial intelligence refers to the simulation of human intelligence in machines that are programmed to think, learn, and problem-solve. These intelligent systems can execute tasks that traditionally required human cognition, such as decision-making, pattern recognition, and natural language processing. From machine learning to robotic process automation (RPA), AI is revolutionizing industries by offering faster, more efficient ways of operating.
The AI impact on fields like accounting, finance, taxation, ESG and broader legal landscape is both transformative and challenging. On one hand, AI has the ability to accelerate the growth, however, it also raises questions of ethics, bias and implication of automation on decision making process.
AI can predict the future, optimise the energy usage, ability to process vast data and executing the trades with exceptional speed, accelerating the overall business growth. Classic wisdom by Shakespeare is “The earth has music for those who listen,”. AI, in this context, becomes the tool to “listen” more carefully to the Earth’s distress signals.
AI can analyse transaction patterns and flagging anomalies that may indicate fraudulent transactions then supporting in risk management. AI systems can assist in automating compliance checks related to Anti-Money Laundering (AML), Know Your Customer (KYC) protocols, and tax reporting.
AI models are especially relevant to pharma companies as it predicts disease outbreaks and optimize drug distribution in underserved areas. AI in banking make it feasible for rural borrowers to receive microloans based on non-traditional credit assessments.
Banks like JPMorgan Chase and HSBC use AI to detect unusual transaction patterns and prevent fraud in real-time. Tools like IBM Watson Health analyse medical images and patient records to help diagnose cancer and other diseases. AI used by companies like Shell and BP to predict equipment failures and prevent costly downtime. AI improving service quality by assisting providers like AT&T and Vodafone in predicting and managing data traffic. AI used by Airtel’s “Airtel Thanks” and Jio’s MyJio assistant to handle millions of customer queries. Companies like Bosch and GE use AI-powered computer vision to detect product defects on production lines. AI used by Amazon and Flipkart to suggest items based on browsing and purchase history. Zara and H&M use AI to let users search for clothes using images instead of keywords. Companies like Tesla, Waymo, and Cruise are developing AI to handle navigation, object detection. Platforms like Netflix and YouTube use AI to recommend content tailored to each viewer’s habits.
IFRS 15 (Revenue Recognition) requires companies to align revenue with performance obligations. AI tools now assist in contract analysis, ensuring correct revenue treatment.
In India, Section 44AB of Income Tax Act, 1961 mandates tax audits for businesses over a threshold. AI-driven tax software can auto-flag mismatches between GST filings and tax returns, reducing manual intervention.
AI is used by tax departments (like GSTN in India) to analyse return filing behaviour, detect tax evasion, and generate risk profiles of companies.
There is the “black box” problem in AI. Automation increases efficiency, yet also risks opacity. We no longer understand how decisions are made. The classic novel “Frankenstein” by Mary Shelley reminds us that unchecked technological advancement can sometimes lead to unintended consequences. Similarly, AI in trading can lead to volatility and market manipulation in case not properly regulated. The classics have long warned us of a world where human invention outpaces wisdom.
IFRS 13 (Fair Value Measurement) requires transparency in how financial values are determined. If AI models determine fair value, firms must explain the methodology.
SEBI (India) and SEC (U.S.) now require explainability in AI-powered investment advice.
BIS (Bank for International Settlements) has published frameworks on AI risk governance for central banks.
Under the Copyright Act, only a “human author” can hold copyright.
Consent management and purpose limitation are required by laws like GDPR (EU) and India’s Digital Personal Data Protection Act, 2023.
There is a saying in classic works that with great power comes great responsibility. AI can do amazing things, but it also brings challenges. For example, if it’s not carefully designed, it might make unfair decisions or take away certain jobs. That’s why it’s so important for people, governments, businesses, and everyday users to make sure AI is used in ways that are fair, transparent, and respectful of human rights.
In Dickens, A Tale of Two Cities, he wrote that “It was the best of times, it was the worst of times.” This aptly captures our current relationship with AI. As Prospero from The Tempest novel said that “We are such stuff as dreams are made on”. If AI is our creation, let it carry the best of our dreams and none of our nightmares. In the final act of any Shakespearean play, redemption or downfall often hinges not on fate, however, on choice. We must choose wisely how we design, deploy, and regulate it as AI becomes popular in finance, taxation, ESG, governance, and law.
(This article is written for academic purpose only. For any queries, author can be reached at garimamittal@live.in )
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