Impact of Artificial Intelligence on Management Accounting Practices and Strategic Decision-Making: Evidence From Indian Businesses

Abstract

AI is fundamentally changing the role of management accounting from narrowly periodic‚ transaction-centered reporting to continuous analysis‚ forecasting and decision support․ This paper examines the transformation experienced in India in organizations and decision making․ In the absence of experiment or panel data at the firm level‚ this study relied on secondary data and evidence synthesis․ The NASSCOM-EY AI Adoption index 2․0 survey (comprising 500 Indian firms representing seven sectors)‚ the EY India C-suite GenAI evidence base‚ recent corporate disclosures from Indian firms‚ and peer-reviewed research on AI‚ machine learning and management accounting were the data sources underpinning evidence synthesis․ The taxonomy maps AI to five categories: transaction and reporting automation‚ cost and profitability analysis‚ budgeting and forecasting‚ performance management‚ and strategic risk and decision support․ AI will likely have the most impact on management accounting by compressing the information cycle by automating data preparation‚ enabling faster variance analysis‚ predictive forecasting‚ and anomaly detection and scenario modeling․ AI will likely not replace management accountants in the near term․ An analysis of Indian companies' maturity done with its 2024 AI maturity model found overall scores on a 4 point scale of 2․47 and that 87% were at the mid-zone 'Enthusiast' and 'Expert' levels․ Data readiness‚ alignment with business processes‚ skills and governance could limit the implementation of proofs of concept․ The paper proposes a human-AI management accounting framework and shows that strategic value results when analytical capability is combined with trustworthy data‚ explainability‚ professional judgement and governance․ The findings show that AI can improve strategic agility and the business-partner role of management accountants in India‚ but measurable value requires organizational integration and not just technological adoption․