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New Report Pinpoints Top Factors Driving Audit Profession

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Aug 3rd 2015
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Rapidly increasing amounts of data and the technology capable of analyzing it are the driving forces in audit, according to a newly released survey by Forbes Insights and Big Four firm KPMG LLP.

But the audit profession needs to grow beyond specific technology tools or analytical methods, survey respondents indicated. It's the critical thinking and interpretation of the information the technology provides that will increase auditors' value.

“Technology, however, is only an enabler,” James Unruh, former chairman of the audit committees at Prudential Financial Inc. and Tenet Healthcare Corp., said in the introduction to the survey, Audit 2020: A Focus on Change. “Only critical thinking by the auditor can lead to the analysis of more dimensions of issues.”

Further, deeper analysis will depend on advancement beyond technology to include culture, professional status, and skill sets, the report states.

Here are six key findings from the survey of 151 financial executives, audit committee chairs and members, academics, audit associates, and accounting students.

  1. Most of the respondents (93 percent) say audit must evolve. A third believe auditors should go beyond the numbers, and 59 percent say the auditors' role should stay the same but their performance should evolve.
  2. The biggest challenges to this audit enhancement are culture (66 percent) and the regulatory environment (59 percent). The two are linked by intense regulation that fosters a structured, process-oriented working environment. That, in turn, creates resistance to change.
  3. The auditor of the future will have to be more proactive. Half of the respondents indicated that would provide more insights, almost half said it would increase quality, and 41 percent said value would be enhanced.
  4. More than half of young auditors and students believe the most important way for audit to evolve is through heightened professional status. In fact, audit should be more than a job, and career tracks should be made more rewarding.
  5. Technology has the biggest impact on audit, according to 58 percent of respondents. Most young auditors considered technology's biggest benefit to be the tools it provides for sophisticated analysis. Among all survey respondents, 59 percent say the biggest benefit is efficiency.
  6. Respondents equally weighted three top skills for auditors: Experience in the client's industry, investigative financial skills, and critical thinking. And adaptability is the foundation for those skill sets.

“As companies embrace data and analytics in their financial reporting and growth strategies, the types of controls and risk assessment needed are evolving,” Scott Marcello, KPMG's vice chairman of audit, said in a prepared statement. “This is just one example of how technology and digitization are impacting our role as auditors. The audit profession is already changing to meet this new landscape.”

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More Analytics and Tech Needed in Audits

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