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Is the Search for Expert IT Professionals Still a Far Cry for Audit Work?

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Recently, the Comptroller and Auditor General of India (CAG) Girish Chandra Murmu welcomed the initiative of SCO Member SAIs in incorporating latest technologies into audit work to ease a few workloads that have been painful to handle. In fact for many years, there hasn’t been a single one that didn’t pass without the cries seeking individuals sharing expertise around IT audit. On the other hand, there is pressure demanding the usage of technology and this adds to their worries as technology continues to advance.

Nonetheless, the difficulty of auditing emerging technology in the new digital era shouldn't be overstated. Processes and procedures for internal auditing that have been tried and true are still relevant. The use of current and developing technology in organizations today and in the future must be understood by internal auditors. The potential hazards and assurance gaps must also be known to them.

Like with other internal audit engagements, curiosity, imagination, and the capacity to ask the correct questions of the right individuals are crucial. But they can accomplish a lot of this without having specialized IT expertise. For specialized areas, external support can be enlisted, but all internal audit teams will certainly interact with evolving technologies in some capacity; they should take the time now to consider what this implies for their operations and audits.

The majority of internal audit teams are familiarizing themselves with the auditing technology that supports remote work and well-established corporate IT systems, and many are beginning to use data analytics and Big Data to guide their audits. The developing technologies, which are now relatively uncommon but are projected to advance quickly, must now be closely monitored. Any risks or assurance gaps that this produces must be anticipated by internal audit.

Significance of AI in Auditing Processes
Conventionally, auditing techniques involved meeting with the auditee to begin the audit process; as a result, it includes information gathered by the client. Document screening and inspection are indeed provided, but only on a sample basis. It would provide the auditors a reasonable assurance and increase the likelihood that the client-hidden papers would be compared.

The auditors now have access to the client's database thanks to technological advancements, giving them complete access to information pertaining to the company's finances and activities. The same will enable auditors to broaden their perspectives and have access to firm data. Artificial intelligence and analytical techniques could provide auditors the power to identify high-risk corporate sectors. It consists of automatically identifying the dangerous fields, establishing outliers, quickly reviewing the prior data analytically, and, to a certain extent, allowing the auditors to check for compliance with the Accounting & Auditing Standards.

Since emerging technologies are constantly in association with internal and external systems, newer risks come with every new connection. This makes more sense why internal audit should consistently monitor the health of the IT system of their organization and its important to steer clear when working with emerging technologies.

The AI-based auditioning model will lessen the dependency on the current system's input from humans and increase system clarity.

Hazards Involved with AI
We must understand that auditing functions as a predictive model, warning the system of potential flaws in the near future. It does more than only verify the truthfulness and fairness of internal and external affairs. The same machine learning engine will function as the main server for finding gaps and potential threats in current firm operations after an AI-based auditing model is established.

Focus on Cybersecurity and Other Issues
The risks associated with AI are numerous. Security is crucial since the more data a system uses from more sources, the more linkages and entry points there are, and the higher the potential threats. If a company, for instance, employs AI to determine whether to perform maintenance on large machinery or in goods like autonomous vehicles, there may also be physical dangers. AI may also be utilized to determine the causes of medical issues. It may cause harm to users before a problem is discovered if it is poorly set or malfunctions.

Certain risks are similar to those associated with other new technologies; for instance, data privacy is expected to be significant when utilizing AI. Internal audit should verify that data users have given their explicit authorization for their data to be used and shared.

Also, there have been instances where biased data was used to train AI systems. A system is more likely to make similar conclusions that could reflect observable human biases from over this era if it is created using data gathered over a lengthy period of time and configured to make decisions based on prior logic. There is a chance that a business would not only shortlist the incorrect people, but also harm its brand and perhaps incur legal fees.

Although strict auditing norms and standards have been tightened over the past ten years to increase efficiency, there are still vulnerabilities since fraudsters are more skilled than highly qualified auditors.

The CAG also emphasized SAI India's leadership in utilizing cutting-edge technology and AI to improve audit processes for quick and risk-based analysis of both structured and unstructured data.

To ensure efficient oversight and compliance, audit personnel evaluate information system controls, third-party management, governance, documentation, user access controls, and legal compliance during SAI India audits, he said.

Since emerging technologies are constantly in association with internal and external systems, newer risks come with every new connection. This makes more sense why internal audit should consistently monitor the health of the IT system of their organization and its important to steer clear when working with emerging technologies.

Will AI Replace Humans?
Although it is now far less in India than in the west, the use of AI is expected to increase. Once some of the things choose to be managed by the machines, the problems or creative tasks that the specialists are currently concerned about will no longer exist. The fear of computers has been observed in the past. Several employees—aside from those who were forced to make the switch when computers started doing the majority of the work—believe that they are useless.

AI may not replace human expertise in financial and auditing operations. Regardless of how AI may affect the accounting sector, businesses will always need human-powered essential thinking.

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