Sebastian St枚ckle,听Author听| Article Posted date28 February 2024
Welcome to the audit of the future as businesses tap into the remarkable power of artificial intelligence. AI has the potential to transform the audit process through automation, data analysis, continuous auditing and enhanced risk assessment, empowering auditors to have a more meaningful impact. Many business benefits are already emerging in the areas of insight generation, trend and anomaly detection, risk control and data-enabled decision making.
In our recent study,听AI in financial reporting and audit: Navigating the new era听we found that nearly 72 percent of companies surveyed are already piloting or using AI in financial reporting and is set to reach 99 percent in three years.
I had the opportunity to speak with 乐鱼（Leyu）体育官网 colleagues Kevin Kolliniatis, Head of Data & Analytics, 乐鱼（Leyu）体育官网 Global Solutions Group; Anne Basta, Senior Director, Audit Technology, 乐鱼（Leyu）体育官网 in the US; Guillermo Maria Wesolowski Valenzuela, Senior Manager, Audit, 乐鱼（Leyu）体育官网 in Spain; and Henning Lieder, Director and Specialist, Digital Audit, 乐鱼（Leyu）体育官网 in Germany. These subject matter specialists provided timely and informed insights into the AI trend and how it can benefit organizations in today鈥檚 fast-changing business and regulatory environment. Here鈥檚 a summary of our conversation.听
How are 乐鱼（Leyu）体育官网 firms leveraging AI to audit the financial statement?
乐鱼（Leyu）体育官网 firms are among the leaders in bringing the power of AI to the audit process. One example is through our implementation of 乐鱼（Leyu）体育官网 Clara AI transaction scoring powered by MindBridge. This is a sophisticated platform and tool that analyzes transactions on a more-granular level to enhance audit quality. It effectively scores each individual transaction by applying rules-based, advanced statistical and machine learning algorithms, allowing 乐鱼（Leyu）体育官网 auditors to look at complete data sets and focus on the greatest areas of risk.
We take a different 鈥� and collaborative 鈥� approach that鈥檚 beneficial both to 乐鱼（Leyu）体育官网 auditors and 乐鱼（Leyu）体育官网 firms鈥� clients. From an auditor's perspective, we're focusing on what matters to clearly understand the flow of transactions and identifying the transactions at greater risk of error. At the same time, we maintain productive conversations with clients around transactions that pose greater risk.
How are 乐鱼（Leyu）体育官网 firms leveraging generative AI to audit the financial statement?
Microsoft Copilot is a new, fast evolving and highly productive AI tool that acts as a personal assistant while using the Microsoft 365 suite of applications. It enables 乐鱼（Leyu）体育官网 audit professionals to focus on the more complex and risk-based areas of the audit. For example, applying large language models to Microsoft applications such as Teams, Word, Outlook, PowerPoint etc, as well as calendars, emails, chats 鈥� it effectively puts AI at our fingertips to enhance audit productivity and can help 乐鱼（Leyu）体育官网 firms deliver exceptional results for clients. As our听global research听shows, more than two-thirds of organizations surveyed tell us that they want their auditors to prioritize the use of AI for data analysis and quality management. Copilot accelerates content creation, eliminates repetitive tasks, and improves decision making 鈥� allowing 乐鱼（Leyu）体育官网 auditors to concentrate on what they do best. It鈥檚 a remarkably powerful technology solution that firms are rolling out globally as we take 乐鱼（Leyu）体育官网鈥檚 audit process into a new era.
How are 乐鱼（Leyu）体育官网 firms implementing AI into 乐鱼（Leyu）体育官网 Clara to audit the financial statement?
乐鱼（Leyu）体育官网 firms are implementing AI into our 乐鱼（Leyu）体育官网 Clara financial statements through 乐鱼（Leyu）体育官网 Clara AI, a technology solution powered by Microsoft Azure OpenAI 鈥� a generative AI solution that uses large language models to generate human-like responses to auditors. This has countless applications, and we are implementing new use cases into the 乐鱼（Leyu）体育官网 Clara platform. For example, 乐鱼（Leyu）体育官网 professionals can benefit from the prompt library to document their understanding of data or to analyze documents provided by the entity. It鈥檚 important to note, however, that output generated from this technology solution is not intended to be a substitute for auditors and will always require professional judgement and skepticism to verify that the responses are accurate and appropriate.听
How are 乐鱼（Leyu）体育官网 firms providing assurance over AI use in financial reporting?
AI is rapidly providing new opportunities and benefits for businesses and society by transforming workplaces and key industries. As AI becomes increasingly prevalent in business and daily life, however, significant concerns exist regarding AI鈥檚 ethical use and potential risks.
This includes a focus on emerging regulatory requirements, for example the听European Union AI Act听鈥� the world鈥檚 first comprehensive AI law. This landmark legislation aims to protect fundamental rights, democratic values, the rule of law and environmental sustainability amid AI risks1听鈥� while boosting innovation and establishing Europe as a leader in the field. Companies doing business in the EU will now need to assess the impact and requirements of the Act and 乐鱼（Leyu）体育官网 firms are playing an important role in providing guidance and required assurance as this revolutionary technology gains momentum.听Our global research听shows that 64 percent of companies expect their auditors to have a role in evaluating AI use in financial reporting and to provide assurance over their AI controls. 听
乐鱼（Leyu）体育官网 Trusted AI framework听is our strategic approach and framework for designing, building, deploying and using AI strategies and technology solutions in a responsible and ethical manner. 乐鱼（Leyu）体育官网 firms are committed to upholding ethical standards for AI tech solutions that align with 乐鱼（Leyu）体育官网 values and professional standards 鈥� and that foster the trust of 乐鱼（Leyu）体育官网 clients, people, communities and regulators. We are steadfast in our commitment to act in a way that serves the public interest, honors public trust and demonstrates our commitment to professional excellence.
Sebastian St枚ckle
Global Head of Innovation and AI, Audit, 乐鱼（Leyu）体育官网 International and Audit Chief Technology Officer
乐鱼（Leyu）体育官网 in Germany
