Fall 2017 issue of Horizons

These firms don’t need as many employees, and those employees may not need to work as many hours. Virtual audit techniques can be combined with this. Errors and anomalies can be addressed promptly rather than months after year end. Clients have better recall of events when discussed soon after they occur. The constant interaction between the audit team and the client means that team members acquire a deeper understanding of the business. According to Anderson, “it’s really understanding the client’s business where you can provide value to the client, where you can help them improve and make things better and make more money and cut costs. That’s really what we should be doing.” Data Analytics Anderson believes that data analytics will be the foundation of the audit of the future. Using existing technology, auditors examine a client’s transactions to spot trends.

For example, a customer whose previous on- time payment suddenly slows to 10 days late may signal a risk of default. Data analytics should not be confused with analytical review. Analytical review procedures examine a client’s data in aggregate to examine trends for the client as a whole, such as changes in inventory turnover. Data analytics looks at the details of transactions to determine inventory turnover for each of the client’s customers. “Using big data and data analytics will be absolutely the springboard for the accountant as the auditor to provide more insight to the client,” said Anderson. Moving To The Audit Firm Of The Future According to Anderson, a key is learning to communicate and work virtually with your clients. Being familiar with this technology “positions you for the audit of the future. Because [in] the audit of the future, with artificial intelligence and analytics, a lot of that ticking and tying will be done internally.” Leveraging technology to provide greater insights provides more value to the businesses being audited. But it will also require time and commitment from firm leaders to change workflow habits and firm culture. The potential payoff is huge. Audit clients will be happier with deeper insights that help them achieve business goals. Employees will be happier in a culture where innovation is valued and thinking is rewarded. The audit will transform from a commodified necessity to a valuable opportunity for business improvement.

ASSURANCE SERVICES GROUP

RubinBrown utilizes a unique, value-added approach to our audit services. The ViewPoints report focuses on understanding all aspects of your organization and enables us to evaluate the overall effectiveness of your organization. For more information, visit www.RubinBrown.com/Assurance .

Felicia Malter, CPA, CGMA Partner-In-Charge Assurance Services Group 314.290.3249 felicia.malter@rubinbrown.com

How Audit Methodologies Will Change in the Future

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