Nurhaliza Nurhaliza

Digital Accounting Transformation for Agri-Fintech Startups: Opportunities and Risks in Developing Countries

Introduction

Digital accounting transformation for agri-fintech startups: opportunities and risks in developing countries. Digital accounting transformation for agri-fintech startups in developing countries: factors, impacts on reporting quality, compliance & cyber risks. Presents AF-DAC model for adaptive, secure strategies.

Abstract

The transformation of digital accounting is an urgent need for agri-fintech startups in developing countries. The complexity of agricultural transactions, the demands of compliance with IFRS/XBRL standards, and the increasing cyber risks demand an accounting system that is not only efficient but also transparent and auditable. This research aims to identify the factors influencing the adoption of digital accounting, evaluate its impact on information quality and regulatory compliance, and design a conceptual model that is able to integrate technological, organizational, regulatory, and risk aspects in the context of agri-fintech startups. The research uses a mixed methods approach with a sequential explanatory design. Quantitative data was collected through a survey of 45 agri-fintech startups in Southeast Asia and analyzed using PLS-SEM. Qualitative data was obtained through in-depth interviews with 7 selected startups and analyzed by thematic analysis. The results show that internal factors, such as technology readiness, organizational support, and perceived benefits and ease of use, play a significant role in adoption. The adoption of digital accounting improves the reporting quality and readiness of XBRL, but cyber and operational risks negatively affect the accuracy of reports. This research resulted in an Agri-Fintech Digital Accounting Capability (AF-DAC) model that integrates cloud accounting, blockchain ledger, RegTech–XBRL, and cyber risk panels. These findings provide a theoretical contribution to the digital accounting literature and are practical for startups, regulators, and investors in designing adaptive, secure, and sustainable accounting transformation strategies in the agri-fintech sector.

Review

This paper addresses the critical and timely topic of digital accounting transformation within agri-fintech startups in developing countries, a sector grappling with complex transactions, stringent regulatory demands (IFRS/XBRL), and escalating cyber risks. The research comprehensively aims to identify adoption factors, evaluate the impact on information quality and compliance, and propose a conceptual model. Employing a robust mixed-methods approach, combining quantitative survey data from 45 Southeast Asian startups with in-depth qualitative interviews from 7, the study provides valuable insights into this nascent yet vital area. The initial findings highlight the significant role of internal factors like technology readiness and organizational support in driving adoption, ultimately improving reporting quality and XBRL readiness. While demonstrating the positive influence of digital accounting on information quality and XBRL compliance, the study importantly identifies a critical caveat: cyber and operational risks can negatively impact report accuracy. This nuanced finding underscores the dual nature of technological advancement, requiring careful risk mitigation strategies alongside adoption. The developed Agri-Fintech Digital Accounting Capability (AF-DAC) model, which integrates cloud accounting, blockchain ledger, RegTech–XBRL, and cyber risk panels, is presented as a practical framework to navigate these challenges. However, the abstract could benefit from a clearer articulation of the AF-DAC model's unique theoretical contribution beyond integrating existing technologies, and how its design specifically addresses the identified risks in a novel way. Furthermore, while the regional focus on Southeast Asia provides depth, a discussion on the generalizability of these findings to other developing regions would strengthen its broader applicability. Overall, this research offers a substantial theoretical contribution to the digital accounting literature and provides significant practical guidance. It equips startups, regulators, and investors with a conceptual framework to design adaptive, secure, and sustainable accounting transformation strategies in the dynamic agri-fintech sector. The emphasis on both opportunities and risks, particularly the negative impact of cyber threats, offers a balanced perspective crucial for successful implementation. Future research could expand upon the long-term impacts of the AF-DAC model's implementation, explore cost-benefit analyses for different startup sizes, and delve deeper into specific risk mitigation strategies beyond just identifying their negative impact. This study is highly relevant and timely, marking an important step in understanding and facilitating digital transformation in a critical global sector.

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