Progressive technology is at the core of evolution regardless of the industry. Like Edtech transformed the education industry and e-commerce changed the way people shop, new auditing technology is revolutionising how audits are performed. Auditing plays a crucial role in keeping a check on different business activities. It ensures that everything is running as prescribed and best practices are followed. The scope of an audit is extensive, and there are numerous types of audits conducted by different companies. One of the most popular audit processes needed by all businesses is financial auditing. Read on to know what financial auditing entails and the new-age auditing solutions for audit firms.
What is a financial audit?
A financial audit can be explained as the process of evaluating the vital financial documents related to a company. It is conducted to ensure that the information mentioned in the official records is accurate and fair. This is done to instil trust among stakeholders and help them provide insights based on which they can take the required actions. A financial audit aims to check fraudulent business practices and ensure transparency in the organisation. It also assesses whether the accounting practices being followed are as per the requirements of the business. A thorough analysis of all financial documents, including profit and loss statements, balance sheets, cash flow statements, etc., is conducted.
Innovative audit solutions for audit firms
Over the past decade, many new technological innovations have transformed the auditing industry. They have paved the way for improved auditing processes and a more productive workforce. The error probability has also reduced drastically as most repetitive tasks have been automated. Here are some of the most innovative audit solutions for audit firms in the contemporary.
- Cognitive technology
Cognitive technology is concerned with a part of the computer science field that mimics the functions of the human brain. It is a part of the artificial intelligence framework that has played a crucial role in automating different tasks for businesses. The top audit firms in India use cognitive technology to process tons of data and derive insightful conclusions from the same. The analysis conducted using this technology is not just less time consuming but also employs fewer resources. It is almost impossible to achieve the same output with human labour.
- Predictive analytics
The use of machine learning is omnipresent in developing algorithms for computer software to gather information and act as per the predefined instructions. The name predictive analytics is very suggestive of the work this technology does. It leverages advanced data analysis techniques to make future projections regarding a subject. The use of AIML technology helps in improving the accuracy of the information predicted. For example, auditing firms deploy digital software to gather data and then run predictive analysis to identify the underlying patterns and trends. It is excellent for predicting financial risks for a business, given its historical records and current market conditions.
- Cloud solutions
If you had asked someone to picture an auditing job a decade ago, they would’ve naturally imagined landlines, desktop computers and an office desk. Today, the setting has changed with the advent of intelligent digital hubs and cloud solutions. Auditors can also work from the comfort of their homes with these new-age solutions. Anytime & anywhere has become the norm in the era of cloud solutions. Innovative platforms allow auditors to work remotely in real-time and leverage the latest automation and analytics software to get their job done.
- Better communication tools
Communication plays a crucial role in improving the productivity of workers. The ability to share information in real-time using advanced communication tools has reduced the timeline for most tasks. In addition, affordable video conferencing solutions have also made it easier for auditing firms to connect with their clients in person. Maintaining human connection through face-to-face interactions plays a critical role in establishing trust and addressing queries.
- Dynamic reporting dashboards
Auditing firms use innovative dashboard reporting software to view information from multiple sources in a single window. It helps them work more efficiently towards their set objective. These dynamic dashboards also automate the report generation process that can be leveraged to deliver comprehensive auditing reports to clients.
Over the past few years, modern technology has revolutionised the face of auditing. They have drastically enhanced the auditing process and helped firms to improve their customer experience.