Issues in Auditing
[Name of the writer]
[Name of the institution]
Issues in Auditing
I hope this e-mail will find you in best of health and spirits. I was really glad, in fact, amazed, to find your e-mail in my mailbox this morning. I have read all your concerns that you have mentioned in the discussed e-mail regarding the current technological advancements in our field, i.e. auditing. I can feel the stress that you have tried to pour in the message in the e-mail. I am replying this quickly to your e-mail is so that I can cater to concerns and try to satisfy you as soon as possible.
First of all, I would like to tell you about some of the latest technologies that have been recently inculcated in the field of auditing and accounting, especially auditing (Flowerday, Blundell, and Von Solms, 2006, pp, 327). I am pretty sure that you already know about many of them or at least the basics technologies that are taking over our practice.
Dear Savannah, as you already know that technology is taking over everything and there is no stopping to it, our area of work, auditing, is also going through revolutionary changes. The inculcation of information technology is affecting every area of life, from cooking to agriculture, from space sciences to daily household chores, everything is being controlled by technology. Then how it is possible that such a big area of corporate world, auditing, is left behind such a big change.
But you do not need to worry; it is both a positive and negative thing for us, auditors. First of all, talking in general terms, the inculcation of technology has undoubtedly made things easier for the auditors to a great extent. This has also made the whole process much speedier (Minishi-Majanja, and Ocholla, 2004, pp. 194). The task that used to take months to complete can now be completed in a few days and even minutes. But the inculcation of technology has also posed a threat for the humankind in many ways.
Your concerns are pretty much valid because the addition of technology to every field is taking the place of humans. The work which was done by a team of 10 people earlier can be managed by a single person and sometimes even not hat single person is required, as a single machine or software can handle that. So, much of the labour or workforce that used to be previously employed are now switching to alternate jobs or is unemployed.
Coming towards the area of auditing and talking specifically about the latest technologies used in the field of auditing and accounting, there are a number of advancements that are being currently employed in this field. Some of the prominent technologies in this area are Audit Support System, Blockchain Technology, Cognitive Technology, Predictive Analytics and smart digital hubs (Dowling, and Leech, 2014. pp. 235). All these technologies are being used currently in the area of auditing and accounting to handle large amounts of data and process them at a much faster speed than the previously employed technologies.
Going into a little detail of all the technologies, I will first introduce you to the Blockchain Technology. Blockchain is a term used for an immutable series of records which is time-stamped and is distributed and managed over a number of computers. It may be in the form of a group or a cluster of computers (Crosby, Pattanayak, Verma, and Kalyanaraman, 2016. pp. 71). Blockchain technology consists of three basic pillars; decentralization, transparency, and immutability. As far as the Audit Support System is concerned, these are the systems that are deployed by audit firms to facilitate effective and efficient audit processes. Usually, it is the enabler or the enforcer of the firm’s audit process.
All the latest advancements that have been discussed above facilitate the auditors in one way or the other. For example, if we consider the example of Cognitive technology, it can be hugely timesaving for the people working as professional auditors. It can enable such people to redesign and manage their work in such a way so that they can conduct huge amount of complex analysis on structured and unstructured data. It was not possible some years back but now, thanks to technology, it is.
In a similar manner, Blockchain technology has also proven to be extremely useful for us, auditors. The basic advantage of this type of technology is defined by its three major qualities or characteristics as I have already mentioned. Moreover, Blockchain allows the users to verify data without being depending on any third party. Another advantage of this type of technology is that the data present in this software cannot be altered or deleted and the trail of any sort of ledger can easily be traced, right up to its origin.
Enough of telling you about the good sides of the latest technologies in auditing. Let me now inform you about some of the downsides of this kind of technology. As far as the Blockchain technology is concerned there are certain disadvantages of this kind of technology. Firstly IT uses excessive energy; it uses a lot of electric computer energy (Tapscott, and Tapscott, 2016). Moreover, the data stored in the database is indestructible; once the data is fed in the server, it remains there forever. It is a good and bad thing both for the auditors.
Other technologies come with similar kind of disadvantages. In cognitive systems or technology, it comes with a lot of complexity. The handling of data in all the types of technological aspects of auditing is tough but with new soft wares and technologies have made it extremely demanding for the auditors to focus on the processing of data. One of the main issues with the Audit Support System is its different filing requirements. Every organization has different requirements for data keeping and most of the organizations keep data in electronic form. Hence, sometimes it becomes difficult for auditors to retrieve data from different types of sources especially different type of resources.
As far as the question is concerned that how much potential these technologies have to replace the human auditors, I will also tell this to you in detail. It may be my personal opinion but as far as I think technology has is not much capable of replacing humans in any field. Although I already said that technology has taken over many jobs and taken the place of much important labor, that used to work in different fields earlier, still technology cannot completely replace the humans in any field. The reason behind the formation of opinion is that that technology may be much faster, speedy or efficient in terms of performance than the humans, there is always the need for humans to operate the systems. Humans can never be replaced by any system, even the artificial intelligence systems, although they are becoming very strong in the current times. There is always human intelligence needed to initiate and terminate the process. Auditing technologies may be able to collect, process, analyze and store the financial data at a very fast pace but still some humane interaction is required to initially feed the data on which the software or technology can work (Moravec, 2015, pp. n.d.). So, my dear friend, you do not need to worry about the security of your job at all. Auditors will always be needed no matter how much advanced the technology or digital technology in the area of auditing becomes.
I hope you got answers to all your questions and I am very positive that I have been able to resolve your concerns at a much better level. Hope to hear from you in the future as well.
Your colleague and friend
The rationale behind the presentation of all the facts and figures in this paper is to show the supremacy of humans and human intelligence. Basically, this paper has been written keeping in mind four major points:
To inform the reader (or my friend) about the latest technologies that are taking place of human effort specifically in the area of auditing.
To inform the reader (or my friend) about the pros and cons of these latest advancements in technology for auditing.
To indicate that no matter how much progress the technology makes, humans will always be ahead of artificial intelligence.
To relieve my friend of her stress and give surety to her that her job as an auditor is completely safe.
Crosby, M., Pattanayak, P., Verma, S. and Kalyanaraman, V., 2016. Blockchain technology: Beyond bitcoin. Applied Innovation, 2(6-10), p.71.
Dowling, C. and Leech, S.A., 2014. A Big 4 firm's use of information technology to control the audit process: How an audit support system is changing auditor behavior. Contemporary Accounting Research, 31(1), pp.230-252.
Flowerday, S., Blundell, A.W. and Von Solms, R., 2006. Continuous auditing technologies and models: A discussion. Computers & security, 25(5), pp.325-331.
Minishi-Majanja, M.K. and Ocholla, D.N., 2004. Auditing of information and communication technologies in library and information science education in Africa. Education for information, 22(3-4), pp.187-221.
Moravec, H., 2015. Mind children: The future of robot and human intelligence. Harvard University Press.
Tapscott, D. and Tapscott, A., 2016. Blockchain revolution: how the technology behind bitcoin is changing money, business, and the world. Penguin.
Useful LinksFree Essays About Blog
If you have any queries please write to us
Join our mailing list
@ All Rights Reserved 2023 firstname.lastname@example.org