Digital auditing for digital natives
By Olwyn Connolly FCA
Digital auditing tools deliver a range of benefits to accountancy firms and their clients in areas such as efficiency, collaboration and data management. At the same time, the digital audit can be a major enhancer of staff skills, accelerating professional development and work as a catalyst in the practical education of young accountants.
Many junior auditors will have had a frustrating experience in the early stages of their careers.
Given the basics to do, they’d often be sent to the client CFO’s office to ask simplistic questions around labour costs, or why sales went up or down.
The CFO would roll their eyes, tell the junior they didn’t understand their business, and usher them out as fast as they could.
On both sides this was an exercise in frustration. The CFO didn’t receive any new valuable insights to his or her business, while the confidence of the junior auditor could have been undermined, with no positive outcome for their professional development.
The advent of new digital auditing tools is an opportunity to change this and transform the quality of the auditing experience and the development of younger auditors.
Instead of scouring rows of numbers on an excel spreadsheet, innovative data visualization tools enable young accounts to see the story in the numbers faster and more easily, better equipping them for more meaningful conversations with clients which in turn add momentum to collaboration and learning.
The outcome is more capable and motivated staff on the audit side who can make a positive difference to the client base.
The next generation
Younger accountants entering the profession are digital natives who are familiar with using the latest technology in their daily lives and expect the same of their workplace.
They are looking to add value to the work they do, and for progressive and innovative ways to do their work.
These young accountants will be graduates fresh from tertiary education and on their way to professional qualifications, and for them digital auditing is less about honing those basic skills and more about acquiring new skills faster.
The bedrock of their education and their understanding of auditing methodologies are rooted in the fundamentals which have served the accounting profession well.
But to send them back to paper based processes and older technologies such as excel means that not only do they have to master unfamiliar skills and ways of doing things – even if these have been used in accountancy for decades – but the firm is missing out on the natural digital abilities they have developed since birth.
If accounting firms are not responding to the increasing digital maturing of their clients, and the digital skills of younger employees, they risk losing out in the talent war because this next generation will look to other firms which are more digitally enabled.
The big change with digital auditing, from a user perspective, is the way information is accessed and presented to enable more clarity of analysis.
This helps young people, most of them with already highly developed digital skills, and equips them to be better at their jobs, and faster.
The company I work for, Inflo, has strong links to the global accounting bodies and our software has been included in the qualification process for the ICAEW in the UK.
Students use the Inflo platform in an examination situation to deliver responses as they apply their learning, find the answers and present them.
This is a comparatively new initiative, but already the feedback has been positive. Examiners have been impressed with the practical nature of the student responses and report a shift in how the skill sets they have learned in the classroom are being applied.
The global accounting bodies are all strongly focused on the future, and a key part of that is a view on how technology can help transform the profession and elevate the role of the accountant and the quality of service they give to clients.
This begins with education, but today there is still a gap which needs to be bridged between what young accountants learn when they acquire post-graduate qualifications, and the skill sets which forward looking firms are looking for.
Technology can help bridge that gap and provide learning support for the development of skills which can more easily translate to real world situations.
Those firms which embrace technology can take advantage of a major opportunity to prepare the next generation of accountants for the transformation of the profession which is already underway, and will only gain momentum in the coming decades.
The creative accountant
In the technology enabled future, accounting work will be less menial, more creative, and have a stronger emphasis on communication skills.
Data will be critical, but accountants will approach data not as scientists, but as interpreters and storytellers looking for compelling insights on behalf of their clients.
For them to do that, familiarity with technology is essential and will only become more so.
All creative people use tools to hone their skills over time, and the same applies to young accountants for whom data visualization is the language of their professional future.
As the Chief Customer Officer on Inflo’s Executive Team, Olwyn is ultimately responsible for ensuring Inflo’s customers’ satisfaction and success.
Olwyn brings more than 15 years of accounting and audit experience, with a strong focus on professional education, public policy and customer services. She has collaborated with global accounting bodies to implement initiatives that helped to future-proof the global profession. She is passionate about driving the education agenda forward to support individuals and firms evolve in the digital era.
Want to hear more from Olwyn? Then join her on Wednesday, 13 October for the Inflo’s Future Firm Series Webcast Part 2: Building digital capability in your audit function. During this session, you’ll discover the capability requirements that partner with digital audit technology and gain a competitive edge for retaining talent for your firm.