AUDIT ANALYTICS AUDIT

ESSAY 1: CONTINUOUS AUDITING—A NEW VIEW
timeliness and scope (for example, process assurance, data-level
assurance). Furthermore, they state that audit standards tend to lag
behind advances in technology, and many basic audit procedures have
not been updated to complement these developments. It also mentioned
that the Center for Audit Quality (CAQ) (2011) held roundtable
discussions that suggest that investors must act on timely and continuous
financial information and it should be explored whether auditor
assurance should be provided for financial information disclosed by
managers throughout the year.
Furthermore Zhang et al. (2012) argue that "auditors face a challenge in
accessing data as there are no standard requirements in place for data
availability. Auditors do not have ready access to their clients’ accounting
data, even when the clients’ business operations have become almost
entirely digitized. As technology is the major driver of the evolution of
the audit process, the AICPA Assurance Services Executive Committee
(ASEC) Emerging Assurance Technologies Task Force is trying to pave
the way for enhanced use of technology and advanced data analytics in
the audit process. The audit data standards, including data standards,
data access, audit applications and continuous audit, are formulated to
facilitate data acquisition in a standardized fashion and advance the
process of audit automation" (Vasarhelyi et al. 2011).
The CAQ initiated an effort to guide the profession towards a set of audit
data standards that would guide organizations to make data available to
auditors in a standardized format allowing for the homogenization of
utilization of data using common auditor oriented applications ("apps").
The AICPA’s ASEC took this effort over 14 and is progressively issuing
this guidance. Figure 1-5 displays a symbolic view of an automated audit
architecture that links: 1) existing corporate IT systems (including
outsourced ones and Big Data Links, 2) extractor routines, 3) ADS
standards, 4) automatic audit plan generation, 5) apps, 6) app selection
routines, and 7) continuous assurance.
14 www.aicpa.org/InterestAreas/FRC/AssuranceAdvisoryServices/Pages/AuditDataStandard
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