Digitalization of Foreign Exchange Difference Accounting: Challenges and Prospects in Emerging Economies

This article examines the digitalization of foreign exchange difference accounting in emerging economies, with a special focus on Uzbekistan. Exchange rate volatility increasingly influences financial reporting accuracy, business decision-making, and overall economic stability. Although International Financial Reporting Standard (IAS) 21 provides guidelines for recognizing and reporting exchange differences, its practical application in transition economies faces challenges, including limited digital infrastructure, insufficient professional capacity, and incomplete integration of advanced technologies. Using a combination of comparative analysis, case study, and statistical evaluation, the study compares international best practices with Uzbekistan’s current situation. The case of Windermere Pro LLC demonstrates how manual accounting processes and delayed recognition of exchange rate differences distort financial outcomes, while blockchain- and AI-based simulations significantly improve transparency, accuracy, and efficiency. The findings show that digitalization reduces operational risks, enhances compliance with IFRS, and strengthens risk management systems. The research contributes to the literature by integrating digital technologies into the conceptual framework of foreign exchange difference accounting and provides practical recommendations for enterprises and policymakers in emerging markets.