Question

what the impact of a specific technology on auditing. Provide a description of the technology, an explanation of its current and potential future impact on auditing, and a suggestion of how auditing and auditors can better adapt to the changes brought about by the technology.

Technology Description: Provide a brief description of the technology you chose.
 Impact on Auditing: Provide an explanation of the current impact of the technology on auditing and its potential future impact. Support your analysis
with research.
 Suggestions for Adapting: Provide suggestions for how auditors can better adapt to the changes brought about by the technology. If the technology you chose creates challenges for the profession, make suggestions for how auditors can adapt to meet these challenges. If the technology offers opportunities for the profession, make suggestions on how auditors can better adapt to take advantage of these opportunities.

Answer 1

Technology description:

One of the technologies that is currently being utilized and could impact auditing in significant way is Artificial Intelligence (AI). AI helps in generating tasks which could otherwise be done by humans over a longer period. The technology would analyse the data, full set of population and throws out meaningful decisions. Certain programs are designed and if the inputs are given it would throw us the output. It exhibits some form of human intelligence and it includes number of technologies like data mining, image and speech recognition. It relies on humans for the coding and basic programming like any other compute software. It is a developing technology and is being used in various industries.

Impact on Auditing:

AI is being used in various industries and audit profession is also exploring the said technology for improvement in efficiency and output. It could bring so many opportunities for presenting the work in a better way and better insight into the audit process. It could optimize their time and let them focus on other issues which requires more human intervention. AI will measure the performance of the data and suggest where efficiencies can be gained by focusing technical and human resources. AI is being used in extracting the data from various contracts, license agreements and other documents and analyse them in a shorter period of time than it would take for a human to it. It also results in accuracy as the same is not being done by humans. From the output thrown by AI they could further dig deep into the situation and seek more data and clarifications from the management. In this way AI could impact auditing and provide better quality audits.

Suggestions for adapting/Challenges/opportunities

The auditors while using any technology should exercise the due care whether the technology can be used in the said context or not. The same applies to AI also. AI cannot be used in all the scenarios and for all the data. The challenges involved in AI include that AI itself is prepared by humans. So there is always a chance of human error and biasedness in the technology. Another challenge is AI audit. It has to kept safely from fraudulent activities. So frequent testing controls should be in place to ensure that the same is not exploited.

In spite of the challenges AI gives lot of opportunities for auditors to improve the quality of audit process. Further improvements in AI could help in doing behaviour analysis and auditors could also give deeper conditions for the program before the output is given. AI could also check the master data from time to time and test the data completeness, integrity and could report if any changes. The other opportunities include they could use AI for evaluating processes and control design also. As a result, future internal auditors will become highly technical professionals and perform better audit.