Divider
Divider

The secret to increasing data accuracy; cut audit prep time by more than 90%

Auditors of all types struggle with accessing and analyzing the data needed for efficient, trustworthy audits. Find out how to drastically cut audit prep time, saving thousands per audit.

May 21, 2012
Sponsored by Datawatch

Auditors of all types struggle with accessing and analyzing the data needed for efficient, trustworthy audits. As the president of an independent bank audit firm comments, “Now, more than ever, there is tremendous pressure to get more productivity out of audit operations.”

Audit expenditures go up and down as a percentage of revenue over time. According to an article in CFO Magazine “Auditing Your Auditor”by Tim Reason, award-winning editor of CFO.com, the current trend is down. He cites information gleaned from Audit Analytics reports and attributes this to audit firms accepting lower fees due to:

  • Benefits realized from Sarbanes-Oxley internal controls
  • Increasing willingness of clients to shop for a new auditor on price
  • CFOs comparing their audit costs against industry benchmarks

Auditors are also under pressure due to economic demands to hold or lower general and administrative costs as a percentage of revenues. Traditionally a “cost plus” business function, internal audit is being forced to find ways of doing more with the same or fewer resources.

Current challenges faced by auditors

The challenges to audit effectiveness resulting from lower audit expenditures include increased risk in several key areas:

  • Less preparation time
  • Potential decrease in data quality
  • Less time testing and evidence gathering
  • Less experienced audit staff

Achieving cost-effective audits with fewer resources requires organizations to do more with less while maintaining or increasing quality results. For auditors, a tremendous opportunity exists in improving how existing data is accessed and utilized in the audit to:

  • Provide timely access to data in the right form
  • Increase trustworthy data
  • Detect anomalies, fraud and trends across comprehensive data sets
  • Minimize direct IT involvement

Auditors often say they spend too much time working with instead of analyzing data both prior to and during audits. The reason is that many auditors have no direct access to data sources across the organization. This is illustrated by a recent survey sponsored by Datawatch (Datawatch Auditing Survey, 2011), where 97% of the respondents reported they must work with data from multiple sources including:

  • Excel – 77%
  • Databases – 54.3%
  • ERP systems – 42.9%
  • Accounting and general ledger applications – 77.1%
  • Mainframe and legacy systems – 5.7%
  • Network files – 14.3%

Respondents also stated that they must work with data in loosely structured and semi-structured formats such as PDF, flat files, and others.

Solution

Auditors who identify themselves as having an average or advanced technology strategy have discovered that report analytics are key to ensuring timely, trustworthy, comprehensive audits with minimal IT involvement.

Some of these organizations take a very sophisticated approach to audit analytics, with more than half automating the collection of data—bringing even more efficiency to the audit process.

Using a report analytics platform simplifies data preparation for external and internal auditors across all major data sources. Turning days into hours—and sometimes even minutes—at a measurable cost savings.

A report analytics platform provides direct access to data throughout the organization, allowing it to be assembled on the fly using easy to learn and share rules or “models,” increasing trust in the data (unlike in manual data processing), and allowing comprehensive testing to spot anomalies, fraud, and trends.

Using a report analytics solution:

  • Minimizes audit process disruption, which saves time and money; for example, one audit firm using report analytics has reduced the amount of time spent on audits from as much as 15 hours per client to just minutes.
  • Enables easy fraud detection; report analytics led to one auditor identifying and escalating fraud within hours, not days.
  • Promotes transparency and audit effectiveness, through the ability to access data directly from the reports, rather than through manual data entry
Given the pressures on today’s auditors, few can stay with the data prep “status quo.” Instead, more than 5,000 auditors and nine out of the top 10 global auditing firms have turned to report analytics to make their audit data prep process more efficient. Isn’t it time you investigated the benefits of report analytics for auditing?

Learn the Auditor's Secret Weapon for how report analytics can help you achieve lower-cost audits without sacrificing effectiveness. 

Download the full Best Practices report today.

About Datawatch
Datawatch empowers organizations to transform the valuable information that is trapped in static reports, PDF files, text files and other content-rich, but difficult-to-use sources, into a dynamic information analytics system that accelerates and improves decision-making throughout their operations. Datawatch’s technology allows its 40,000 customers worldwide to leverage the investments they have made in reports from ERP, CRM and other applications into high performance analytic information at a fraction of the cost and time of traditional approaches. Datawatch is headquartered in Chelmsford, MA with offices in London, Munich, Sydney and Manila, and partners and customers in more than 100 countries worldwide.