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In: Accounting

You are a partner in a medium-size CPA firm and want to convince your partners that...

You are a partner in a medium-size CPA firm and want to convince your partners that your firm should update the way it conducts audits in order to become more competitive. Specifically, you believe the company should make use of up-to-date data analytics technology. Write a memo to your partners to explain what data analytics technology is and the advantages to using it.

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Expert Solution

Due to Advances in Technology, Accountants Now have access to powerful data analytics or statistical tools.

Data analytics refers to analysing a large set of data to reach a meaningful conclusion and to identify anomalities for furthur investigation.

Various Technology have devleoped to analyse data in the Commercial world.It has become an essential to analayse data to remain competitive in the business world.

Various Technique used are Regression Analysis,simulation,Clustering,Classification etc.

Examples of Data analatics software include Tableau , Rprogramming ,Excel,etc.

Advantages of Using Data Analytics Technology

  • Deep Understanding Of business being audited
  • Detects and corrects errors in data sets through data cleansing
  • improves the quality of data
  • Easy availabitlity of audit evidence
  • Better advance Planning
  • Easy identification of Problem areas
  • reduces spend in ensuring assurance of reliable financial statements
  • Visual display makes it less ambiguous to understand rather than numbers or texts.
  • Allows auditors to better ralate to the trends, patterns of the business
  • Helps to identifiy outliers easily
  • etc.

ekkarill92 answered 1 year ago
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