Naledi Matlala | Project Manager | Assurance | South African Institute of Chartered Accountants (SAICA) | mail me |
While many audit tools and methods have evolved over time, the practice of audit has been in existence for years. But how do we as auditors stay ahead of the curve of managing emerging technologies in auditing?
As audit professionals we often find ourselves facing unique challenges ranging from misalignment with auditor staff to insufficient identification of changing risk areas with technology advances and keeping pace with emerging technologies while ensuring the integrity of financial information.
To curve these challenges and demands of being an auditor, we have to learn to put in place and embrace best practices that will assist in navigating the complexities of digital audit. Moreover, emerging technology has the potential to increase audit quality while adding value for our stakeholders.
To serve organisations well and conduct high-quality audits, the auditor of the future needs to be digitally adept, and this can be achieved through the adoption of some of the best practices.
Some of the best practices that can be adopted to enable us to provide value to our stakeholders are the following:
Continuous learning
Investing in continuous learning such as attending training programmes, seminars and webinars that focus on emerging technologies, regulatory and industry changes can be valuable.
Technology is quickly evolving, and the real-time economy is transforming how data is received and processed. Therefore, an auditor can also obtain relevant certification in artificial intelligence (AI) which can be instrumental in enhancing expertise in auditing and emerging technologies.
Emerging technologies knowledge
Being proactive in learning to gain a better understanding of the purpose, scope and potential risk of emerging technologies through reading media articles, newsletters and other technical material.
Risk assessment
Performing a comprehensive risk assessment throughout the audit is crucial to identify potential threats to emerging technologies, taking into account data privacy and compliance with laws and regulations.
It also ensures that the right resources are allocated to ensure focus is placed on significant areas based on the risk assessment procedures performed.
Technical tools
Incorporating specialised technical expertise and leveraging IT tools to enhance audit procedures and address risks associated with technology is an indication of an evolving audit approach and auditors should look into that.
This also ensures efficiency in the audit and allows auditors to remain relevant in this digital era.
Collaboration
The auditor of the future should consider collaborating with IT professionals, data analysts, and AI / machine learning (ML) experts, which can be very valuable for the audit.
It opens opportunities for auditors to gain an understanding of the technology utilised by audit clients, properly evaluate the risk, conduct effective data analysis, and evaluate and assess the reliability of AI systems.
Professional objectivity and judgement
Maintaining professional scepticism is paramount. We are to critically evaluate evidence, assess the reliability of data and apply professional judgement to identify any inconsistencies.
This also assists in being proactive through addressing potential fraud risks in the digital audit world by implementing robust controls and monitoring systems.
Related FAQs: Audit profession – the impact of emerging technologies
Q: How are emerging technologies impacting the audit profession?
A: Emerging technologies are significantly reshaping the audit profession by enhancing audit quality, improving efficiency and effectiveness and enabling auditors to focus on higher-value tasks. Technologies like artificial intelligence, data analytics and blockchain are being integrated into the audit process to streamline workflows and provide deeper insights.
Q: What role does automation play in the audit process?
A: Automation plays a crucial role in the audit process by enabling auditors to automate repetitive tasks, such as data collection and analysis. This not only saves time but also reduces the risk of human error, allowing auditors to concentrate on more complex areas that require professional judgment.
Q: How can auditors embrace new technologies to improve their audit practices?
A: Auditors can embrace new technologies by investing in training and development to understand advanced technologies like predictive analytics and robotic process automation. Additionally, staying updated on emerging trends and adopting relevant technology tools can enhance their audit experience and improve the overall audit quality.
Q: What are some examples of technology tools that can enhance the audit process?
A: Some examples of technology tools that enhance the audit process include audit software that utilises data analytics for risk assessment, robotic process automation for task automation and blockchain technology for secure and transparent transaction tracking. These tools help auditors to streamline their workflows and improve accuracy.
Q: What is the future of audit in relation to technology adoption?
A: The future of audit is closely linked to technology adoption, as auditors must adapt to new technologies to remain relevant. This includes the use of artificial intelligence, data analytics and emerging trends in governance and internal control to shape the future of auditing and address the evolving needs of clients.
Q: How does blockchain technology affect the audit process?
A: Blockchain technology impacts the audit process by providing a secure and transparent way to record transactions. This allows auditors to access real-time data and enhances the reliability of information systems, making it easier for auditors to perform assurance tasks and verify the integrity of financial records.
Q: What skills do auditors need to develop to thrive in a technology-driven audit environment?
A: Auditors need to develop skills in data analytics, understanding of artificial intelligence, and familiarity with emerging technologies such as blockchain and robotic process automation. Additionally, they should enhance their critical thinking and problem-solving abilities to interpret complex data effectively.
Q: How can data analytics be used to shape the future of audit?
A: Data analytics can be used to shape the future of audit by enabling auditors to analyse large datasets for trends and anomalies, which helps in identifying risks and providing insights. By leveraging analytics, auditors can enhance their decision-making and provide more valuable recommendations to their clients.
Q: What challenges do auditors face when adopting new technologies?
A: Auditors face several challenges when adopting new technologies, including the need for substantial investment in training and technology tools, resistance to change within audit teams and the complexity of integrating advanced technologies into existing audit processes. Overcoming these challenges is crucial for successful technology adoption in the audit profession.
