At a time when investors want corporate transparency improved and financial information reported faster, Rutgers University will use a grant from KPMG International to establish a laboratory that will research and test next-generation technologies and methods for continuous business reporting and auditing.
The Continuous Assurance and Reporting Laboratory (CAR-Lab), to be housed at the Rutgers Accounting Research Center (RARC), will develop experiments that use actual corporate information from two cooperating companies to test continuous auditing techniques. CAR-Lab seeks to improve audit procedures by publishing its findings in research reports and presenting live demonstrations of promising new technologies to business executives, policy-makers and regulators.
“While the field of continuous auditing was first proposed in 1990, research on the topic has been mainly conceptual up until now,” said Miklos Vasarhelyi, a Ph.D. at RARC and Director of the CAR-Lab. “The lab will undertake applied research in the field using real-life data from complex corporate information systems to test concepts and demonstrate working examples.”
“The start-up funding will be used to create the laboratory, KPMG will also provide talented individuals to help conduct the research and apply the lessons learned in experiments that one day may help companies present relevant corporate information in a more timely fashion,” said Stuart Campbell, managing partner at KPMG’s Audit and Advisory Services Center (AASC), a research facility for KPMG International and its member firms. “The CAR-Lab should help accelerate the transition toward continuous reporting and auditing.”
Continuous business reporting refers to the ability for companies to provide timely, updated, audited financial information.
An advisory board composed of professionals in accounting, auditing, information systems and technology will advise the CAR-Lab.
The grant for the CAR-Lab is funded by KPMG International, KPMG LLP, the U.S. member firm of KPMG International, and the U.S. firm's KPMG Foundation.