- Book Chapter
- 10.4324/9781003620525-11
Emergence of Generative AI
- Mar 13, 2026
- Mohamed Mesroua
This chapter discusses the opportunities and challenges posed by the use of generative AI in the Sharia auditing profession. Generative AI (GAI) technologies have the potential to transform the operations of the financial and auditing departments completely. In a way, they perform self-importance roles such as building insights and automating challenging tasks while enhancing decision-making in these sectors. It is evident that through the use of GAI, the power of deep learning and neural networks can be harnessed to improve business processes and monitor outliers, which are critical for achieving both compliance and transparency in finance. However, we must highlight certain drawbacks that come along when employing GAI for Sharia-compliant auditing. According to Islamic law, Sharia compliance is based on Shariah rules and laws, so the audit has to meet certain requirements. Hence, auditing has to obey certain ethical and legal aspects.Does GAI integration into Sharia-compliant audits carry a concern of operating outside the technological, ethical, and Islamic principles? Yes, it has been observed that GAI systems depend on algorithmic geography, data tenderness, and the rules of regulation for their use. Besides, the GAI uptake exposes the increasing need for Sharia data and gaps in the interpretability of existing AI models. These are some of the reasons why GAI for Sharia auditors is attractive, even as there are challenges like automation of compliance and fraud detection, and a gap in operational definitions.This chapter explores the implication of GAI on Sharia auditors in terms of contemporary practice impact, challenges like ethics and technical limitations, and new opportunities for efficiency and compliance improvements. This discussion embeds insights from recent research, including works like Rabbani et al. on the necessity for ethical frameworks relating to AI in Islamic finance and Brown et al.’s findings about advanced language models in terms of their competency for actionable insight performance. Based on these aspects, this chapter will seek an all-rounded appreciation of the challenges and opportunities generative AI does or will pose.
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