Accounting for the future: practice, Artificial Intelligence and regulation

This paper is a feed-in regulatory analysis for the ongoing EU legislation on Artificial Intelligence (AI). The main argument is that accounting was left behind by this EU proposal for regulation and its three risk categories. The future of the Artificial Intelligence Act is both inclusive (specifically addressing many activities) and exclusive (takes out from the scope of regulation certain industries and applications). Despite the rather extensive sphere of (non)application of the proposal of regulation, accounting falls in a third category of unaddressed industries. Our argument is that accounting should be taken into consideration and be included in one of the categories, according to the regulatory proposal classification. By creating a regulatory framework for accounting in AI, a certain sense of certainty can be created in the markets and in the profession. Accounting is a decision-making tool with control capacity over financial and social behaviour, due to its informing capacity and pro-cyclicity influencing value, hence being able to create risks and possible moral hazards.