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US Auditing Standard Board Plans To Adopt Blockchain Technology, AI And Data Analytics

The United States is about to integrate futuristic technologies such as Artificial Intelligence, Blockchain, and Data Analytics to auditing techniques and practice.

The use-case that the American Institute of CPAs (AICPA), through its integral part- the Auditing Standards Board (ASB), is targeting is the Audit Evidence Statement functionality and the agency intends to develop a fully-fledged platform that is anchored on the three technologies.

The adoption of Blockchain, AI, and Data Analytics will modernize the auditing process and enable auditors to work in a transparent data-driven environment with few errors and omissions.

Adoption Of Technology In The Auditing Space Is A Growing Phenomenon

The ASB (Auditing Standards Board) of the AICPA (American Institute of CPAs) is exploring the use of technology in auditing techniques and practice in regards to evidencing data.

At this project phase, the ASB is holding consultations with stakeholders to explore strategies of building a platform that proffers audit standards to serve the dynamic audit sector.

Is Audit Evidence Sufficient?

Traditional audit practices may not be able to cope with the increasing demands from clients to see sufficient and appropriate audit evidence.

In particular, the financial and non-financial information is deemed critical in the auditing field and it is only new technology that can offer practical solutions.

Some of these technologies that the ASB is exploring to cope with the emerging audit needs include artificial intelligence (AI), audit data analytics (ADA), Blockchain, and robotic process automation (RPA).

Although these technologies can power a next generational platform that can revolutionize auditing techniques and practices, they have varying risks and opportunities and AICPA is carefully considering each risk and opportunity that each of the technologies can offer.

Robert Dohrer, CGMA, CPA, and AICPA chief auditor is stressing the importance of a robust auditing platform as there has been a rapid evolution of audit evidence sources which brings about need to consistently assess data that is being obtained by auditors from different sources.

The AICPA Is Waiting For Consensus to Build The System

At this phase of the project, the AICPA-based ASB is waiting for consensus among stakeholders on the proposed Statement on Auditing Standards (SAS). If the agreement is struck, the SAS would be revised and there would be new standards of Auditing and Evidence provision.

According to Dohrer, adoption of the new standards will modernize auditing practices and techniques and make it easy for practitioners to verify their sources of information and present the data to their clients or other concerned parties.

Blockchain

The Role Of Blockchain In Auditing Transformation

Blockchain is a fundamental technology in the proposed project because it can offer data provenance on Distributed Ledgers. Since the ledgers are immutable, and transparent auditors can conveniently use the platform to offer audit evidence.

Some of the challenges of the old SAS include; concerns of reliability, relevance, completeness, and accuracy of audit evidence, application of professional skepticism, constrained sources of information, etc.

Meanwhile, Blockchain enthusiasts and results-oriented auditors in the USA can only hope for the new technology-powered SAS by 15th June 2021 if consensus is achieved among AIPCA stakeholders.

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