The word “AI” refers to computer systems that have some resemblance to human intellect. It includes data mining, machine learning, speech recognition, image identification, and sentiment analysis, among other technologies. AI is already being used in a variety of fields, including autonomous vehicles, home energy systems, and investment portfolio management. Accounting and auditing will be impacted as well.
AI allows for the examination of a large amount of data and the detection of outliers or exceptions. Machine learning, for example, can be used to automatically code accounting items. Auditors can increase fraud detection by using advanced machine learning-based models. Deep learning, a type of AI that can evaluate unstructured data like emails, social media postings, and conference call audio files, is likely to further change the audit. Humans can assess a bigger number of contracts, such as leases, in a much quicker timescale using machine learning methods than they can with a standard manual review. In a recent pilot, AI technologies were able to accurately extract information from lease contracts in the vast majority of situations using pre-selected criteria — a higher level of precision than the typical human reviewer.
Internal auditors can use artificial intelligence, which uses algorithms to discover and interpret patterns and anomalies in data sets, to more quickly identify areas of risk and do a variety of other jobs. Artificial intelligence systems can take into account both internal and external data, allowing organizations to spot growing dangers and hazards they hadn’t considered before. For example, suppose a government entity sought to audit the COVID-19-related benefits payments. Instead of starting from zero, AI would allow the agency to create a risk register with data from previous benefit payment audits.
AI will help auditors optimize their time by allowing them to use their human judgment to examine a bigger and deeper range of data and documents, allowing them to perform better and smarter. It also allows them to ask better questions and communicate more with CFOs, audit committees, and business boards, enhancing the audit process’ value. As a result, AI may be able to contribute to higher-quality audits – and an exciting future for auditors.
Thank you, Aishwarya Pramod for your article on AI