The advancement of AI and digitalized technologies providing potentials to Micro, Small and Medium Enterprises in terms of efficiency and transparency in context of accounting. This study presents a systematic review of AI adoption in MSME accounting from 2000 to 2025. The objectives are to examine technological evolution, adoption and professional implications. Following the PRISMA-based methodology, 416 records were initially identified across major academic databases. After removal of duplicates and eligibility screening, 53 high quality peer-reviewed studies have been included for final analysis. The review reveals a clear evolutionary progression from early expert system to advanced technologies like machine learning, robotic process automation (RPA), big data analytics, cloud accounting and intelligent audit systems. The results indicate that AI integration enhances reporting accuracy, fraud detection and real-time financial analysis. It has also shifted the accountant’s role from daily and routine processing toward analytical and advisory works. Overall, the study summarizes the literature and provide a base for further studies and policy making.