How Automation and Artificial Intelligence are Changing the Audit – How do you analyze situations that are constantly in flux? How do you detect patterns that are too complex to find? The world of artificial intelligence has opened up new horizons everywhere, including auditing. As an auditor, you don’t need to understand all the intricacies of a technology to use it. But you do have to understand its potential and be ready to reap the benefits for your firm and for your clients. So, how do you get into the AI game?
First, learn how to participate. Find out what automation and AI tools are in the marketplace and become familiar with their capabilities. And explore resources such as emerging tech news feeds, publications, videos and events you can tap into. Then make connections. Look within your own organization to discover who the automation and AI leaders are or if you are the first join an external networking group. Ask them what tools they are using and for any advice on getting started in this area.
It won’t take long before you start recognizing opportunities for automation that you may have previously overlooked. But to automate any process you need digital data. To make sure you’re well positioned to maximize automation, start with obtaining evidence from clients in an electronic format. A common area to start is to automate processes that are consistent and repetitive, such as copying and pasting information or working across multiple data sources.
Imagine the time savings of a bot rebuilding the financial statements from underlying data, allowing the auditor to focus on identifying errors and misclassifications. Lead sheets and variance analysis would be available at the push of a button with pre-designed analytics on journal entries, outstanding receivables, aged inventory and investment valuations. This would in turn shift your time from data collection and manipulation to higher-order analysis and evaluation.
Or you can take intelligent automation to the next level and leverage AI’s pattern recognition capabilities to detect anomalies that auditors can then investigate. Complex patterns and correlated impacts can be detected and analyzed through the use of AI far more accurately and efficiently than ever before.
For example, AI could be used to analyze uncollected debt at the customer level to challenge management’s prediction of collection risk. Or AI could be used to predict the valuation of an investment, including privately held investments that are more difficult to price like real estate properties or private equity.
Finally, never stop innovating. After completing an automation or AI project take a step back, capture your lessons learned and then move on to the next opportunity, of which there will be many, with automation and AI’s use case expanding rapidly. The world of AI is growing. What role will you play?
Web enthusiast. Thinker. Evil coffeeaholic. Food specialist. Reader. Twitter fanatic. Music maven. AI and Machine Learning!