IDEAS home Printed from https://ideas.repec.org/a/gam/jadmsc/v15y2025i2p58-d1588675.html

Artificial Intelligence for Financial Accountability and Governance in the Public Sector: Strategic Opportunities and Challenges

Author

Listed:
  • Ceray Aldemir

    (Public Administartion Department, Faculty of Economics and Administrative Sciences, Muğla Sıtkı Koçman University, 48000 Muğla, Türkiye)

  • Tuğba Uçma Uysal

    (International Trade and Finance, Faculty of Economics and Administrative Sciences, Muğla Sıtkı Koçman University, 48000 Muğla, Türkiye)

Abstract

This study investigates the transformative capacity of artificial intelligence (AI) in improving financial accountability and governance in the public sector. The study aims to explore the strategic potential and constraints of AI integration, especially as fiscal systems become more complex and public expectations for transparency increase. This study employs a qualitative case study methodology to analyze three countries, which are Estonia, Singapore, and Finland. These countries are renowned for their innovative use of AI in public administration. The data collection tools included an extensive review of the literature, governmental publications, case studies, and public feedback. The study reveals that AI-driven solutions such as predictive analytics, fraud detection systems, and automated reporting significantly improve operational efficiency, transparency, and decision making. However, challenges such as algorithmic bias, data privacy issues, and the need for strong ethical guidelines still exist, and these could hinder the equitable use of AI. The study emphasizes the importance of aligning technological progress with democratic values and ethical governance by addressing these problems. The study also enhances the dialog around AI’s role in public administration. It provides practical recommendations for policymakers who seek to use AI wisely to promote public trust, improve efficiency, and ensure accountability in governance. Future research should focus on enhancing ethical frameworks and investigating scalable solutions to overcome the social and technical challenges of AI integration.

Suggested Citation

  • Ceray Aldemir & Tuğba Uçma Uysal, 2025. "Artificial Intelligence for Financial Accountability and Governance in the Public Sector: Strategic Opportunities and Challenges," Administrative Sciences, MDPI, vol. 15(2), pages 1-19, February.
    • Handle: RePEc:gam:jadmsc:v:15:y:2025:i:2:p:58-:d:1588675
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2076-3387/15/2/58/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2076-3387/15/2/58/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Christian Engels & Kamlesh Kumar & Dennis Philip, 2020. "Financial literacy and fraud detection," The European Journal of Finance, Taylor & Francis Journals, vol. 26(4-5), pages 420-442, March.
    2. Bernd W. Wirtz & Wilhelm M. Müller, 2019. "An integrated artificial intelligence framework for public management," Public Management Review, Taylor & Francis Journals, vol. 21(7), pages 1076-1100, July.
    3. Omoshola S. Owolabi & Prince C. Uche & Nathaniel T. Adeniken & Christopher Ihejirika & Riyad Bin Islam & Bishal Jung Thapa Chhetri, 2024. "Ethical Implication of Artificial Intelligence (AI) Adoption in Financial Decision Making," Computer and Information Science, Canadian Center of Science and Education, vol. 17(1), pages 1-49, May.
    4. Aleksandrina Aleksandrova & Valentina Ninova & Zhelyo Zhelev, 2023. "A Survey on AI Implementation in Finance, (Cyber) Insurance and Financial Controlling," Risks, MDPI, vol. 11(5), pages 1-16, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. repec:bjf:journl:v:10:y:2025:i:10:p:722-737 is not listed on IDEAS

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Muhammad Waqas & Alishba Hania & Farzan Yahya & Iqra Malik, 2023. "Enhancing Cybersecurity: The Crucial Role of Self-Regulation, Information Processing, and Financial Knowledge in Combating Phishing Attacks," SAGE Open, , vol. 13(4), pages 21582440231, December.
    2. Zhelyo Zhelev & Silviya Kostova, 2024. "Investigating the Application of Digital Tools for Information Management in Financial Control: Evidence from Bulgaria," JRFM, MDPI, vol. 17(4), pages 1-17, April.
    3. Julia Schwaeke & Carolin Gerlich & Hong Linh Nguyen & Dominik K. Kanbach & Johanna Gast, 2025. "Artificial intelligence (AI) for good? Enabling organizational change towards sustainability," Review of Managerial Science, Springer, vol. 19(10), pages 3013-3038, October.
    4. NDOU, Adam, 2023. "Parental Financial Socialisation And Socioeconomic Status," Studii Financiare (Financial Studies), Centre of Financial and Monetary Research "Victor Slavescu", vol. 27(1), pages 39-58, March.
    5. Calvin Blackwell & Norman Maynard & James Malm & Mark Pyles & Marcia Snyder & Mark Witte, 2024. "Who gets duped? The impact of education on fraud detection in an investment task," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 48(3), pages 734-753, September.
    6. AHMAD Idris & ALNI Rahmawati & ARNI Surwanti & MAMDUH M. Hanafi, 2023. "Financial Literacy To Improve Sustainability: A Bibliometric Analysis," Studies in Business and Economics, Lucian Blaga University of Sibiu, Faculty of Economic Sciences, vol. 18(3), pages 24-43, December.
    7. Liu, Bofan & Lu, Bin, 2023. "Can financial literacy be a substitute for financial advisers? Evidence from China," Pacific-Basin Finance Journal, Elsevier, vol. 79(C).
    8. Khalid Alshehhi & Ali Cheaitou & Hamad Rashid, 2025. "Investigating risk elements and critical success factors for AI procurement projects in the public sector: a qualitative approach based on UAE public organisations," International Journal of System Assurance Engineering and Management, Springer;The Society for Reliability, Engineering Quality and Operations Management (SREQOM),India, and Division of Operation and Maintenance, Lulea University of Technology, Sweden, vol. 16(2), pages 446-467, February.
    9. Kubilay, Elif & Raiber, Eva & Spantig, Lisa & Cahlíková, Jana & Kaaria, Lucy, 2023. "Can you spot a scam? Measuring and improving scam identification ability," Journal of Development Economics, Elsevier, vol. 165(C).
    10. Hagen, Johannes & Malisa, Amedeus, 2022. "Financial fraud and individual investment behavior," Journal of Economic Behavior & Organization, Elsevier, vol. 203(C), pages 593-626.
    11. Ferilli, Greta Benedetta & Palmieri, Egidio & Miani, Stefano & Stefanelli, Valeria, 2024. "The impact of FinTech innovation on digital financial literacy in Europe: Insights from the banking industry," Research in International Business and Finance, Elsevier, vol. 69(C).
    12. Petra Vujković & Dejan Ravšelj & Lan Umek & Aleksander Aristovnik, 2022. "Bibliometric Analysis of Smart Public Governance Research: Smart City and Smart Government in Comparative Perspective," Social Sciences, MDPI, vol. 11(7), pages 1-22, July.
    13. Tae-Young Pak & Swarn Chatterjee & Youngjoo Choung, 2026. "Navigating digital finance: how digital financial literacy influences digital financial services use and benefits in Korea," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 12(1), pages 1-33, December.
    14. Di Vaio, Assunta & Palladino, Rosa & Hassan, Rohail & Escobar, Octavio, 2020. "Artificial intelligence and business models in the sustainable development goals perspective: A systematic literature review," Journal of Business Research, Elsevier, vol. 121(C), pages 283-314.
    15. Carmen Isensee & Kai-Michael Griese & Frank Teuteberg, 2021. "Sustainable artificial intelligence: A corporate culture perspective [Sustainable artificial intelligence: Eine unternehmenskulturelle Perspektive]," Sustainability Nexus Forum, Springer, vol. 29(3), pages 217-230, December.
    16. Armenia ANDRONICEANU, 2025. "The Impact Of Artificial Intelligence On Human Resources Processes In Public Administration," REVISTA ADMINISTRATIE SI MANAGEMENT PUBLIC, Faculty of Administration and Public Management, Academy of Economic Studies, Bucharest, Romania, vol. 2025(44), pages 75-93.
    17. David Aristei & Manuela Gallo, 2021. "Financial Knowledge, Confidence, and Sustainable Financial Behavior," Sustainability, MDPI, vol. 13(19), pages 1-21, September.
    18. Ömer Fuad KAHRAMAN, 2025. "Ai And Decision-Making: A Swot Analysis For Future Perspectives In Public Administration," Theoretical and Empirical Researches in Urban Management, Research Centre in Public Administration and Public Services, Bucharest, Romania, vol. 20(2), pages 81-103, May.
    19. Noha Diab & Nicoleta Isac & Cosmin Dobrin, 2022. "Artificial Intelligence (AI) and Jobs: The Impact of Pandemic on Governmental Organizations in Istanbul - Turkey," REVISTA DE MANAGEMENT COMPARAT INTERNATIONAL/REVIEW OF INTERNATIONAL COMPARATIVE MANAGEMENT, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 23(1), pages 46-64, March.
    20. Daniela Marconi & Marco Marinucci & Giovanna Paladino, 2025. "Digital and Financial Skills in Shaping Financial Decisions: Exploring the Gender Gap," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 11(2), pages 571-605, July.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jadmsc:v:15:y:2025:i:2:p:58-:d:1588675. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.