Over the past 30 years, the Audit process has been improved a lot in the office software corporations such as MS Word, MS Excel, Caseware working paper, Audit Command Language (ACL), repetitive tasks, massive manual data. All such tasks include file organization, audit data preparation, the performance of audit tests, integration of multiple files, manual annotations and copy & paste the data. These tasks are rule-based and also prone to error. Auditors further improve the effectiveness and efficiency of audit practice by leveraging new technologies.
As we know, RPA (Robotic Process Automation) is a software at the user interface level to automate the rule-based, repetitive, and structured data with machine-readable data. RPA executes across many of the applications as well. This article helps in the case study of the employee in an accounting firm for demonstrating and improving the audit quality.
RPA’s Potential Applications to Audit:
In the process of auditing, Automation is not a new term. Robotic Process Automation offers good ability in connecting automated audit unintegrated activities. On the presentation layer, the Automation is an overlay software which translates the program data into user friendly. The audit evidence comes from different sources which leads to a burden for the auditors in collecting. The Automation can streamline the activities of potential preparation and evidence collection by combining various sources into a single audit work-paper. It can also execute the audit tests in other applications like CoreWare IDEA, Excel, and so on. This is how the Robotic Process Automation helps in achieving end-to-end audit automation. There is a line for audit implications for getting better quality. RPA also replaces the time-consuming, structured, and repetitive activities. It should be scalable in many environments and be formatted uniquely.
The public accounting firm, which is headquartered at New York offers more EBPs (Employee Benefits Plan) in audit services. It can also audit more than 800 EBPs per year and participants ranging in between 100 to 90,000. The audits in EBP are incredibly time-consuming and labour intensive, especially in the substantive phase in which it imports the data into Excel workbooks. It also performs the EBP testing, including copy-paste and executing excel functions. In the total EBP audit engagements, the Defined Contribution Plan (DCP) has 88 per cent. An auditor can exclude some procedures if not, then it will show a negative impact on the investments.
RPA Prototype Development:
The Automation Prototype development project includes:
- Process Identification
- Identify the objective
- Process Understanding
- Audit Data Standards
Process Identification: Here, the authors look at substantive procedures in DC plan audits. The main objective is to identify repetitive tasks. Based on the auditing, firm authors focus on personal data, testing eligibility, and employee loans.
Identify the objective: The automation project’s objective is to increase the effectiveness and efficiency of the audit plan because procedure consists of repetitive, time consuming, and labour-intensive testing.
Process Understanding: The loan testing consists of many activities which didn’t need audit judgement in executing the audit engagements. The activities also include audit evidence preparation, collection of audits, interest rates, and loan amount balances. The audit work-paper review reveals many of the testing activities using the combination of automation audit evidence and Structured Query Language (SQL).
Audit Data Standards: It is essential to improve the audit standard, such as AICPA. The standard also contains data formats and labels. The audit evidence source reflects the data differently to maintain consistently on numerous engagements.
RPA is used to automate the repetitive, time-consuming, rule-based, and simple tasks in auditing. The CARLab is used to provide Robotic Process Automation to the Certified Public Accountant (CPA) firm. The above article gives you detailed information about RPA in auditing. Hope this article is helpful. Happy Learning!
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