If you work in the professional services sector, you’re well aware of the rise of automation. For those of us in the tax and accounting profession, we’ve witnessed the amazing time savings and efficiency automation can bring—and audit is no exception.
Not so long ago, auditing in accounting meant spending long hours manually entering taxpayer data, sifting through loads of paperwork, and scrutinizing spreadsheets line-by-line. With the rise of accounting automation, tax inputs and workflow processes are streamlined and standardized, resulting in more accurate results in less time. The same holds true for audit technology.
While some think automation may take the place of an accountant or auditor, firms with a forward-thinking mindset have shifted their services to more value-added “human touch” advisory offerings to grow their business—while letting the robots handle mundane tasks.
Getting up to speed on audit automation technology
Like most industries, technology has transformed the way accountants tackle audits.
Audit automation utilizes cloud-based technology to enable users to work from anywhere, collaborate with colleagues in real time, and securely access audit data. An end-to-end online audit solution with seamless data flow across tools helps auditors get more work done in less time.
In the past, disparate applications created inefficiencies for audit staff like version and quality control issues. When client accounting systems are not standardized, aggregating and digesting financial data is difficult. This causes delays and errors that can have a negative impact on a firm’s bottom line. Not to mention managing the list of prepared-by-client documents which often require a full-time staff member.
An audit is a continual process—and audit workflow should be as well. From automated workpapers to trail balance to analytics, a cloud-based audit suite offers real-time access to audit data. With guided start-to-finish audit preparation, compilation and review methodology, robust data analytics and value-added customer insight, today’s auditors can request and receive secure online audit confirmations anywhere in the world.
The role of AI and data analytics in audit automation
Backed by integrated AI-enabled audit applications, data analytics software and smarter testing can help auditors save time and provide valuable insights to clients. From audit data visualization to advanced reporting capabilities, the latest advancements in technology can help provide clients with deeper and more meaningful advice.
Traditionally, audit firms have worked through their clients to gain access to financial and operational information, select samples of populations, test for exceptions, and extrapolate results. With advanced data analytics, however, auditors can now efficiently obtain client data down to the transactional level, store it securely in the Cloud, and apply analytics against the data to identify risk, including potential fraud risk. Auditors can also more easily benchmark their clients’ business metrics against other similar businesses and provide key insights to help clients run their business more effectively.
When it comes to cognitive capabilities, machine learning and other technologies can be used to provide assisted decision-making for auditors. Because auditing is a very subjective process, it requires significant professional judgment on the part of individual auditors.
This judgment involves things like identifying key audit risks and determining how to design audit procedures to respond adequately to those risks. Because audit judgment skills are typically developed and refined through years of experience, training, and interaction with colleagues, the latest technologies can harness these judgments from across thousands of audits to provide assistance to auditors in real time, while keeping client information private.
The urgency around auditing cryptocurrency is only escalating. With the IRS reporting at least 8% of U.S. taxpayers have reportable activity in crypto, many of these gains/losses are not being properly reported. As the IRS continues to make crypto tax a top priority for compliance and enforcement, clients are looking to their tax professionals for assistance.
To meet this need, a crypto tax reporting software can help accounting firms manage crypto transactions in their workflow process by collaborating with clients in a certified and secure platform. By simplifying compliance difficulties that arise with clients that own crypto assets, firms can capitalize on proactive tax planning and “human touch” advisory service opportunities.
Investors and stakeholders are increasingly seeking transparency in ESG initiatives. Audit and assurance engagements are intended to meet this demand. Third-party assurance from an independent accounting firm results in an objective report designed to verify the reliability of ESG disclosures.
With a deep understanding of collecting, analyzing, and reporting information, auditors can use the latest advances in ESG audit to identify gaps, assess risks, and develop recommended mitigation options for businesses looking to provide ESG transparency to stakeholders.
A trusted partner in audit automation
In a constantly changing audit landscape, achieving efficiency, accuracy and consistency is necessary. Implementing a fully integrated online audit solution is the key to securing your firm’s success now and in the future
Thomson Reuters has a long history of providing audit solutions and leading audit methodology backed by experienced editors and authors who can ensure compliance with professional standards and peer review.
By coupling the latest audit technology with advanced research and learning solutions, auditors can ensure quality and efficiency for all types of audit, accounting, and tax engagements.