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Accounting & Audit

August 2018 Accounting & Audit Channel

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Four Ways to Evolve Your Auditing Firm Today

By Matt Towers, Product Manager, Thomson Reuters Tax & Accounting

By now, most of us have been exposed to some sort of doom and gloom message about automated systems and ‘robots’ taking over the future of the tax and accounting profession. Google “jobs most likely to be replaced by technology”, and you will notice accountant, auditor, tax professional, etc. are all going to show up somewhere. In fact, according to this article on The Telegraph, Oxford University indicates that tax professionals have a 99% chance of their jobs being automated while accountants and audit professionals’ chances stand at 98%.

However, it’s hard to imagine a future state without auditors running the audit, isn’t it? Considering the complete removal of people from an audit process raises a LOT of questions.

And fortunately, the adoption of automation tools will come over the course of many years, with the first impacts likely to be focused on the general automation of audit phases — like data collection/ingestion and data analysis. These are all generally time-consuming tasks in an audit today, but automating these tasks hardly means that people won’t be involved. But it does provide great value to use these tools, as they drive down the cost of how people complete their audit work while augmenting auditor judgment.

So, then, how do firms adapt to this evolving world to make sure they are prepared for when the right technology can help them prosper? To ensure a healthy audit practice going forward, there are four places you can invest in now. Here are the key questions to drive your short-term strategy:

  • Process – How do you currently identify opportunities for process improvement? If you find yourself doing things differently from one partner/manager to another, you might be costing yourselves significant time savings that can be achieved through standardization.
  • People – What skills does your team need, and how can you ensure that your firm’s culture and leadership will keep your best people engaged and hungry? People really are the heartbeat of your firm, and firm leaders must adapt to an emerging workforce that doesn’t necessarily think the way they do. A mindset to welcome change and new technologies is critical to build into your firm’s culture.
  • Planning – When is the last time you really evaluated your audit planning and methodology? It is easy to get caught up in “same as last year” mentality, but reimagining your methodology could do wonders for how you operate.
  • Technology and Cloud – What is the current cost of your audit workflow? It’s critical to do your due diligence about the administrative overhead on your current auditing solution as well as the impact that a cloud-based system can have to improve your firm’s productivity, communication, and bottom line. You don’t want to be playing catch-up with your workflow tools when technology like AI-based data analytics transitions from emerging to ubiquitous.

If you want to start making an impact to evolve your firm, I encourage you to pick one area of focus (people, planning, technology, etc.), then organize a staff meeting around this subject to brainstorm some ideas for improvement. Make sure all voices get heard and that you begin the meeting by setting direction/vision for your firm’s future. You might be surprised at how enlightening it is to engage everyone in this sort of dialogue.

 

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Matt Towers is a product manager for Thomson Reuters responsible for Audit and Engagement products

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Accounting & Audit Social Media:

FASB Approves Simplification of Lease Rules. Tammy Whitehouse via Compliance Week.
https://bit.ly/2LSNXW9

It’s Never too Early to Plan Your Exit Strategy. Dennis Najjar via AccountingDepartment.com.
https://bit.ly/2AMZO2I

Two Vital Ingredients to Maximize Audit Productivity. Brandon Sims via the Wolters Kluwer blog.
https://bit.ly/2OQKrcK

How AI Can Help Improve the Audit Process. Chanyuan Zhang via AICPA Insights.
https://bit.ly/2OP6OyW

Ungarbling Financial Accounting. Tom Selling via The Accounting Onion.
https://bit.ly/2KyD3jB

 

Top Accounting & Audit News:

Finance Execs Continue to Worry Over Lease Accounting.

AICPA Issues Proposal to Revise SSAE 18. The proposed SSAE would no longer require the practitioner to request a written assertion from the responsible party in some cases.
www.cpapracticeadvisor.com/12420180

National Society of Accountants Awards Scholarships. The NSA Scholarship Foundation has awarded 25 students scholarships to continue their college education. Combined, NSA scholarships for 2018 totaled $33,200.
www.cpapracticeadvisor.com/12420335

4 Ways to Evaluate International Payments. United States-based SMEs buying from international suppliers are finding it difficult to pay the right amount on time using bank wires.
www.cpapracticeadvisor.com/12422065

Microsoft and EY Partner to Fight Financial Crime. EY financial crime solutions use robotic process automation (RPA), machine learning and artificial intelligence (AI) to provide efficiency improvements while improving overall quality.
www.cpapracticeadvisor.com/12422591

Many Nonprofits Lack Financial Strength for Growth. Almost half of nonprofits in the U.S. hope to expand their programs in the next two years, but many organizations may lack the financial strength to fuel sustainable growth.
www..cpapracticeadvisor.com/12422584

 

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August 2018 Tax & Compliance Channel

Bill Would Allow IRS to License and Regulate Tax Preparers By Isaac M. O’Bannon, Managing Editor Senator Rob Portman (R-Ohio) has introduced a new bill in the Senate that would give the Internal Revenue Service the authority to regulate income tax return preparers. The bill is cosponsored by Senator Ben Cardin (D-Missouri). The IRS attempted […]

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