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Reconstructing Indonesia’s State Financial Oversight Policy Through Artificial Intelligence for an Accountable Continuous Auditing System Iskandar Zulkarnain; Fauzi Syam; A Zarkasi; Adithiya Diar
Khazanah Hukum Vol. 8 No. 3 (2026): Khazanah Hukum
Publisher : UIN Sunan Gunung Djati

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.15575/kh.v8i3.54262

Abstract

The digital transformation of public administration has reshaped public financial oversight through the growing use of artificial intelligence and continuous auditing. In Indonesia, however, the legal framework for state financial oversight remains largely rooted in conventional auditing, which emphasizes periodic examination, manual verification, and retrospective accountability. This study aims to identify the normative weaknesses of Indonesia’s existing oversight framework and to formulate a policy reconstruction model for integrating artificial intelligence into an accountable continuous auditing system. This research employs a normative juridical method supported by statutory, conceptual, and limited comparative approaches. Primary materials consist of Indonesian laws and regulations on state finance and auditing, while secondary materials include scholarly literature and international reports on artificial intelligence governance, digital auditing, and public sector oversight. The findings show three main problems. First, Indonesian positive law does not yet provide an explicit legal basis for the use of artificial intelligence in public financial oversight, creating uncertainty regarding algorithmic transparency, accountability, and data protection. Second, the absence of integrated audit standards and interoperable data governance hinders the implementation of continuous auditing. Third, institutional readiness remains uneven. The Audit Board of Indonesia is relatively more prepared than the Government Internal Supervisory Apparatus, but both still face capacity and coordination constraints. The novelty of this study lies in its integration of public financial law, artificial intelligence governance, and continuous auditing into a single legal reconstruction model. The proposed model places artificial intelligence as a decision support instrument within a human-centered oversight framework, strengthens legal standards for transparency and data governance, and clarifies institutional roles. This model contributes to future legal reform and offers practical implications for more preventive, adaptive, and accountable financial governance in Indonesia