AUDIT ANALYTICS AUDIT

CASE STUDY B: IMPLEMENTING CONTINUOUS AUDITING AND CONTINUOUSMONITORING
invoices annually, with a further 1,500,000 processed for direct deliveries
to customer stores. Accounts Receivable processes nearly 700,000
transactions each month (Hardy and Laslett, forthcoming). An
automated environment for testing 100 percent of controls and
transactions on a near real-time basis was always going to bring value to
the business if executed appropriately. However, the benefits to be gained
were far more than simply automating manual tasks. Closer alignment
with management needs, reduction of audit costs, improved focus in
audit planning and development of a superior data analytics capability
provided added value in terms of cost, competencies, and relationships.
There was not an explicit focus on these value adding activities in the
early stages of implementing CA/CM. Rather, they emerged over time,
building on incremental successes of rolling out applications of CA/CM
commencing with routine tasks such as duplicate invoices and
progressing to more sophisticated applications that are discussed later.
The benefits delivered so far have exceeded the cost of achieving them.
However, the implementation of CA/AM was not without challenges.
Long lead times, complex technical environments and a commitment of
resources meant that the range of benefits were not easily recognizable in
the early stages. However, savings from automating routine audit
procedures, (for example, potentially duplicated invoice processing),
provided an "early win" for demonstrating value to management. In the
earlier stages of developing and operating the automated testing there
was political resistance from some business owners about the value of
adopting the CA/CM system. Active leadership was required from the
internal audit group to manage not only the technical issues, but also the
change process in terms of managing varying perceptions and
expectations about how exceptions would be identified and managed;
impact on work routines; and the need for collaborative efforts in
designing scripts and using technologies that would best assist in
providing greater insights into business activities. Extensive consultation
was needed to ensure user engagement and that the benefits were
meaningful to the business owners. This transformative approach
assisted in focusing attention on business improvement outcomes, thus,
changing behaviours and demonstrating the value that internal audit can
bring to the business.
THE IMPORTANCE OF ARCHITECTURE
The CA/CM solution resembles data warehouse solutions in that data is
"extracted, transformed, and loaded" into the CA/CM applications.
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