Change is the only constant
The field of audit is being steadily changing and evolving day by day to the computer age and, in recent years, the rise of data analytics has widen the scope of future changes. Chartered Accountants have played and will continue to play a pivotal role in this process. Automation of business information is now reshaping the finance function, altering the way humans approach their work. The pace of this change is unpredictable. Robotics could automate more than 50% of basic accounting work by 2025. For some, it is not a big leap to envision an audit of the future that would be wholly automated, untouched and unsupervised by human beings.
The need for the professional evaluation, judgment and skepticism that auditors bring to the task is now expected to be replaced by the Artificial Intelligence (AI). AI is another technology that is being researched. Experts are researching to understand how to address the lack of transparency around complex algorithms when using artificial intelligence and, more specifically, machine learning in the context of the audit.
Broad tech-driven opportunities are being foreseen to evolve assurance in several areas e.g. data integrity and cyber security risk management. It will strengthen trust and confidence in our global markets. In our fast and connected world, historical reporting is less relevant than real-time reporting.
With the onset of the cloud, automation and data analytics, we are already moving toward greater timeliness in financial reporting. The monitoring and assurance will benefit the public but require much innovation to succeed.
The data analytics can transform the audits of financial statements and will be a key element of the transformation and will provide dynamic audit solution. Analyzing both structured and unstructured data, selection of most appropriate samples from whole population, will help provide greater audit insights.
Auditors will increasingly need to acquire a broader range of skills, from information technology to data science and analytics. The demand for new assurance service lines, such as security operation centers for cyber security, will require expanded competencies. Firms will increasingly seek talent who are digitally proficient and open to new assurance approaches, while still maintaining focus on trust and quality. It is an exciting time for the profession, one that requires urgency, focus and care.