Harnessing the power of audit automation

Today's auditors face a challenging tax environment. From data collection to ever-evolving standards, more and more auditors are turning to technology to automate their audit workflow.

From workpapers to analytics, cloud-based audit automation can provide enormous gains in terms of efficiency, productivity and security.

What is audit automation?

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.

Why is audit automation necessary?

Disparate, unsecure applications can create inefficiencies for audit staff including 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.

In short, auditors who are still relying on outdated, on-premise solutions to store and manipulate audit data are potentially leaving their practice vulnerable.

What are the benefits of audit automation?

There are many benefits of audit automation. By automating your audit workflow, you can access a continuum of benefits that help you easily conquer common auditing challenges. Let's consider the top 3 benefits of audit automation:

1.Real-time collaboration

With cloud-based technology, you can securely access your audit online, from anywhere, with a solution that updates your data and stakeholders in real time. Enable your audit team to work from the same document at the same time without worrying about version control.

With the cloud, there is no more check-out/sync or back-up/restore—all audit data is accessed seamlessly and in real-time. With sophisticated, multi-user content, trial balance, engagement management, and document retention management, the entire audit team has up-to-the-minute access to the entire engagement, from any location, without having to transfer, backup, restore, or refresh the audit files.

Audit teams can access data from across the globe, making it easy to coordinate fieldwork and review processes across multiple locations and allowing remote staff to collaborate in real time. Multi-location audits no longer present a coordination issue because all staff can access the live data simultaneously.

2. Enhanced security

While many still consider cloud-based services to be less secure than on-premise offerings, consider these facts. Cloud businesses must adhere to strict standards and independent audits, known as SOC2 engagements. And because their reputation (and revenue) depends on the security of their services, cloud providers put serious effort and attention to maintaining these security standards.

Further, the cloud enhances security and control over sensitive data by keeping it off of laptops, which are actually the least secure option.

Using the cloud, your firm eliminates the need for software updates, manual backups and server maintenance. Your data and applications are always updated, always secure. All you need to do is log in to a web browser and go to work.

3. Data analytics

Backed by integrated AI-enabled audit applications, audit data analytics software and smarter audit testing can help you save time and provide valuable insights to clients. From audit data visualization to advanced reporting capabilities, the latest advancements in technology can help you 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. This is also helpful in ESG audits and cryptocurrency audits.

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.

How can data analytics help auditors gain insight?

Data analytics can help auditors gain deep insight by:

• Testing full data sets instead of only samples;
• Supporting risk assessment by identifying anomalies in data; and
• Providing audit evidence through comprehensive analysis of an organization's general ledger systems.

Altogether, these benefits provide an opportunity for auditors to gain a better understanding of their clients.
From a staffing perspective, audit automation backed by AI-powered solutions can also provide a source of empowerment. With embedded research and professional standards available throughout the engagement process, even junior audit staff can find answers quickly and confidently.

What audit tasks and workflow components can be automated?

Like accounting, an audit is a continual process. From automated workpapers to trail balance to analytics, a cloud-based audit suite with integrated AI-enabled audit software and applications 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.

Let's take a look at an automated audit workflow.

Audit engagement management

With audit automation, you can expedite your engagement workflow with a cloud-based organizational hub that offers real-time access to all of your work papers and trial balances.

• Workpapers. Easily manage all engagements with extensive templates, a high level of customization, the ability to perform several tasks at once, and much more.
• Trial balance. Complete your work quickly with powerful trial balance capabilities, including fast imports, sophisticated filtering and tabbing.
• Document management. Standardize and organize volumes of documents for an engagement or project.

With full trial balance capabilities, workpaper management and financial statement reporting functionality, you can manage your entire audit from a single source and communicate relevant information to clients, including the status of work overall, workpaper signoff status, and financial advice.

Audit methodology

With risk-based audit methodology, you can build a customized audit program based on your documented risks and assessments to prevent over-auditing. Detailed assistance at the point in time it's needed enables you to perform efficient and profitable audits that comply with professional standards and pass peer review.

• Identify risks. Quickly view any potential risks within your audit and how other firms are managing risk in similar engagements.
• Pass peer review. Rely on audit methodology backed by experienced editors and authors that ensure the materials are accurate to help you pass peer review.
• Dynamic set-up. Save time with an option to only get the forms and questions you need—and that are relevant to your client and your engagement.

In the cloud, version control and staff access issues are a thing of the past. With a trusted engagement process and risk-based design, you can keep up with regulation changes on the go and share information while working on engagements simultaneously in the field or anywhere else.

Secure confirmations

Easily send and request online confirmations securely, eliminating traditional methods that are prone to error and even fraud. With a global network of validated responders, you can be sure you'll get a response.

• Automated assistance. Get a guaranteed response with automated follow up on the auditor's behalf.
• Validated global network. Be confident your response is coming from a validated financial institution.
• Superior client value. Save your client's time with a single, digital signer authorization accessible from anywhere.
• Streamlined process. Eliminate methods prone to errors and reduce confirmation time from weeks to days.
• Comprehensive solution. Manage your audit engagements and send confirmations from the same platform.
• Industry standard security. Roll over client account information from year to year within a secure system.

By streamlining your audit confirmation process, you can increase productivity, reduce cost, enhance customer experience, and combat fraud.

How do I get started with audit automation?

In a constantly changing audit landscape, achieving efficiency, accuracy and consistency is necessary. Implementing a fully integrated cloud-based audit solution is key.

Look for an established auditing and accounting technology provider that offers a dynamic, end-to-end solution for accurate, efficient audits. From automated work papers to advanced analytics, a comprehensive suite of cloud-based audit tools can transform your workflow and take your audit practice to new heights.