Artificial Intelligence for Risk Mitigation in the Financial Industry

Preface

The financial industry plays a vital role in the social and economic development of any country. Economic growth lends complexity to operations, and the leveraging of technology-based decision tools is becoming prominent in today’s world. Consequently, risk mitigation in the financial industry is tuning into this change with the integration of artificial intelligence (AI) systems. The audit process recognizes associated risks and suggests possible transformations to mitigate them. The idea of using AI technology in risk mitigation is not entirely new, because it has been used as a decisionsupport model for the auditors in past. Since the 1950s, researchers have tried to find opportunities to make machines act with human intelligence, and this started to happen at the beginning of the 21st century when machines became able to work on advanced algorithms and perform the analysis and decision-making more intelligently. Due to continuous advancement in technology, availability of enormous big data, and processing capacity, there is reason to believe that it will continue to make a significant impact in risk mitigation in the financial industry.

The applications of the financial industry incorporate vast volumes of structured and unstructured data to gain insight into the financial and non-financial performance of companies. As a result of exponentially increasing data, auditors and management professionals need to enhance processing capabilities while maintaining the effectiveness ...