The world of fast connections between people and devices is booming. Through the connectivity technologies such as platforms, collaborative software, networking applications or portals, huge quantities of information are traded between devices but also between people and devices.
Author: Alina Făniță, CEO PKF Finconta
Beyond the challenges of such a technology, companies also have the opportunity to increase transparency, risk assessment capacity, and audit quality and automate their processes.
This connectivity facilitates companies to create an information environment that provides them with in-depth knowledge of their operations, including auditing.
In order to increase the accuracy and speed of information processing, companies in the financial industry prefer an auditor who capitalizes on this technology progress and proposes digital solutions for carrying out certain processes in the audit mission.
Transforming the financial audit
A financial audit of companies, relevant to the world of fast connections we talked about is beneficial not only to those who deliver it, the auditor but also to the client company.
The financial audit that uses digital channels has three components: automation, data analysis and customer experience through digitalization.
The digital infrastructure (platform, software, etc.) is very important because it makes the connection between the members of the audit team and the connection between them and the audited company.
Under the conditions of receiving permanent information from any device, it is understood that there is a functionality that allows access to information from the mobile phone.
Challenges along the way
What are the challenges for companies that face companies where a financial audit is conducted with the help of digital tools?
- Cultural challenges. Some organizations may be reluctant to share information with auditors through an online platform. This may be due to a lack of knowledge of the audit platform, concerns about how information or data security will be used.
- Data security. Companies need to be careful about the data they share with outside parties and make sure that that data is processed and stored properly.
- Complicated IT systems. Old IT systems can prevent a company from taking full advantage of a financial audit and digital tools. In addition, if some data is not structured and exists only on paper, then the audit process is cumbersome.
Benefits of the transformation
What can companies do to take advantage of the benefits of a financial audit using digital tools?
- To share online with the auditor the amount of structured and unstructured data often collected in ERP systems, which allow the audit team to identify unusual but significant trends as well as financial opportunities and risks for the company.
- To gain a deeper understanding of the balance sheets and allow the monitoring of fraud controls and the improvement of reporting processes.
- To achieve the purpose of using data in digital format, including the unstructured data. From contracts and guarantees to data on provisions for unforeseen costs, making this information available in a digital format for the purpose of the audit assignment improves the basis on which auditors can issue an opinion.
- To facilitate the sharing of information and the access of auditors to their own work systems. When information is securely and efficiently shared through a digital audit platform, the audit process will run smoother and the quality of the audit will be improved. The financial team of the company will also ensure that it will not make additional efforts in preparing the necessary documents and will save time in supporting the audit assignment.
The importance of a digital platform used for financial auditing is demonstrated by the digitization of worksheets, the way of storing and sharing information, accuracy, etc. Real-time updates on each stage of the audit process allow the audit team and the audited company to exchange information quickly and safely.
About PKF Finconta
For over 25 years, PKF Finconta is one of the 10 leading professional services companies in Romania. Since 2006, we are a member of PKF International Limited. PKF International is a leading international business advisory organization. The company grew consistently over the years, forming a Group of four companies: PKF Finconta, PKF Finconta Consultanta, PKF Finconta HR and Finconta Consulting SPRL, members of national professional organizations CECCAR, CAFR, CCFR, and UNPIR. We provide a wide range of business advisory and related specialist services. We have seven core areas of expertise and within these areas, we tailor our services to your business and your needs: audit, corporate finance, tax, bookkeeping and accounting advisory services, transfer pricing, payroll and personnel administration, and insolvency.