As the pace of technological advancement continues, audit firms face the daunting task of finding ways to harness these technologies for their clients to their advantage. Many of these technological advances aren’t just options, but essential to ensure the future of auditing.
The most cutting-edge technology tools that are making a significant impact on the auditor are machine learning, data analytics and robotic process automation. These tools enable auditors to gain a deeper understanding of the client’s processes, inventory, and the system controls. They can then share this information with management and boards.
Blockchain is a new tool that could cut down the time required for financial transaction clearance to just a few hours. This may allow continuous risk assessments during the period of audit, instead of just a single evaluation at the end of each year.
Argus, an artificial intelligence (AI)-enabled software, is one example of a technological advancement that is dramatically reducing the amount manual processing and reviewing that is required during an audit. It utilizes machine learning and natural language processing to swiftly search for electronic documents which allows auditors to concentrate on more valuable tasks such as assessing risk and confirming results.
There are a few hurdles that can prevent the adoption of new technologies. It can be particularly difficult to schedule time to explore new technologies in companies where compensation is based upon billable hours. The initial expenditure, as well as the ongoing costs associated with maintenance and support can be significant. However, with continued collaboration between audit firms, standard setters and regulators, these challenges can be overcome.