AUDIT ANALYTICS AUDIT

AUDIT ANALYTICS AND CONTINUOUS AUDIT:LOOKING TOWARD THE FUTURE
Figure 1-8: Sources of Data (adapted from Qi and Vasarhelyi, 2014)
4.5 Chosen Procedure
Audit procedures have been frequently formalized under GAAS in order
to create guidelines for verification of financial statements. Unfortunately
the standards have not yet explicitly embraced more advanced
technological methods that can deal with the emerging challenges of big
data, cloud computing, embedded decision making, and the like. In
general the audit standards allow for evolution of procedures but do not
necessarily facilitate or require such an effort. See table 1-8 for procedures
and their evolution.
Table 1-8: Procedures and Their Evolution
Client acceptance
and investigation
Client monitoring
Population estimate
Traditional procedures
Multiple mainly manual
methods including
investigators
Statistical or judgmental
sampling
Modern procedure
Identical plus extensive text
mining of sources like
newsprint and social media
Extensive text mining of
sources like newsprint and
social media
Big data population
estimation
Full population
measurement
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