AUDIT UPGRADE
Digital tools and advanced tech play increased role in corporate reporting and external audits.
In Houston, as in business environments worldwide, the quantity of data is increasing, and advanced technologies are playing a significant role in corporate reporting and external audits. According to KPMG’s 2019 U.S. CEO Outlook, CEOs are thinking a lot about technology — with 89 percent of CEOs feeling personally responsible for leading technology strategies within their organizations.
The audit profession is engaging digital tools such as workflow automation, cognitive technologies and robotics in response to the never-ending amount of data. At its core, the work of audit professionals is fundamentally about enabling trust in the capital markets. For the capital markets to operate effectively, there must be integrity and confidence in the financial reporting system. As companies automate more accounting functions and incorporate blockchain into business protocols — and as cybersecurity becomes more critical — new technologies are needed to quickly review volumes of fully automated transactional data and enhance audit quality.
We’ll always need people
Auditors’ jobs are becoming more complex and dynamic. The journey toward building trusted, tech-savvy audit teams starts with finding the right professionals. While technology continues to disrupt all aspects of the business landscape, it’s the people and their skills that will make the difference. Auditors will continue to translate business risk into financial statement risk, and they will use the latest technology to address those risks to enhance audit quality.
With artificial intelligence, bots and other digital tools handling routine work, new recruits need critical thinking and technology skills. The profession must develop innovative ways to attract and retain exceptional talent that’s diverse in thought and skills. In addition to accounting skills, the next generation of auditors will need skills in data and analytics, information technology and cybersecurity.
Technology spurs auditors
Advanced technologies make it possible for auditors to analyze Bob Owen / Staff file photo large volumes of both structured data, which exists neatly in rows and columns, and unstructured data such as e-mails, free-text documents, presentations and web pages. The ability to blend and analyze both types of data enhances auditors’ ability to identify anomalies while providing deeper insights into risks, processes, and controls.
Technology provides an opportunity to automate how the profession gathers evidence to form an audit opinion. For example, data produced by automobiles may offer information on performance, maintenance requirements, and repairs that also may be analyzed to better assess the risk of a company’s warranty obligations.
Advanced technological tools enable and empower professionals and enhance their skills. Ultimately, it’s the professionals who set companies apart and are fundamental to success.
The impact of technology
As companies navigate change and determine how to best address the impact of cloud computing, AI, and blockchain, CEOs have become more realistic — yet enthusiastic — about the scope, timeframes and returns on AI implementation, according to KPMG’s CEO survey. Together, these technologies offer ondemand sharing of information, automation of certain tasks, and the identification of regulated transactions and business issues. Whether separately or combined, technology is pushing enterprises to ask new questions and consider new solutions regarding the accounting, finance and tax departments.
It’s true that for many companies, the changes driven by technology will be nothing short of a full rethink. When that technology is harnessed correctly, it can be used to effectively manage risk, streamline tasks, free up professionals’ time, and, ultimately, drive significant value for the organization.