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Continuous Audit Analysis and Reporting System 4th world continuous auditing and reporting symposiumA. Nutz, E / University of Augsburg University of Salford, April 18th 2002
Computer Aided Audit Technology -
for Continuous Audit
A. Nutz
e University of Augsburg – Germany
Continuous Audit Analysis and Reporting System 4th world continuous auditing and reporting symposiumA. Nutz, E / University of Augsburg University of Salford, April 18th 2002
Content
• Trends / Reasons for the project • CAARS/AIS – the concept• Pilots within E• Next steps
Continuous Audit Analysis and Reporting System 4th world continuous auditing and reporting symposiumA. Nutz, E / University of Augsburg University of Salford, April 18th 2002
• Ongoing discussion on corporate governance• XBRL as a catalyst for standard (audit) routines• Implications of Internet based reporting / risks
by inadequate use of web trust seals• Legal and contractual obligations intensify the
consideration of:- Risk management systems- Monitoring and alert systems
• The move from financial reporting to business reporting triggers the development from financial audit to business audit
Current Trends / Audit Language
Continuous Audit Analysis and Reporting System 4th world continuous auditing and reporting symposiumA. Nutz, E / University of Augsburg University of Salford, April 18th 2002
The audit software has to be used on reliable, quality controlled data.
* Escalating scopeof audits
an information system with adequate data basis („width“ and „depth“)
require
* Increasing auditcomplexity
innovative analysis techniques such as Data Mining, OLAP-technologies and monitoring
requires
Consequences
And as general precondition:
Continuous Audit Analysis and Reporting System 4th world continuous auditing and reporting symposiumA. Nutz, E / University of Augsburg University of Salford, April 18th 2002
Insufficiencies within the use of flat file based CAATS
Financial Accounting
Data as flat file
Performs audit andAssessment
ofClient OLTP-System
Client EDP-Employee
Data Capture at due date
Performs Download
Toolboxof
CAATS
Results
t = single eventuses
EY/IT-Employee
Data Analysis
Feedback on Audit Results
Auditor
Fin.Acc.Data Aging
R/3SAP®
1
2
3
4
5
6
Continuous Audit Analysis and Reporting System 4th world continuous auditing and reporting symposiumA. Nutz, E / University of Augsburg University of Salford, April 18th 2002
Excel, ASCII etc.
RDBMS
HostHost
Integration into EY-Methodology
Improvements by data warehouse / mart based CAATS(Development of Continuous Audit Analysis & Reporting Software
CAARS / AIS)
Excel, ASCII, etc.
Client OLTP
RDBMS
R/3SAP®
EY CAARS
External Sources(Gartner
etc.)
Import (ETL)
Client EY/IT-Employee
EY + client user
CAARSEngagement
Mart
RDBMS
MDDBMS
Flatfile
CockpitOLAPQueryIm
portBenford
Mon
itoring
Data
Min
ing
Reportin
g1
2
3
4
5
67 Main
Continuous Audit Analysis and Reporting System 4th world continuous auditing and reporting symposiumA. Nutz, E / University of Augsburg University of Salford, April 18th 2002
Pilot Engagements / Findings & Results• Piloting took place in six European engagements (F,
GER, CH, UK)•Different size of engagements•Different evaluation focus (audit efficiency
respectively cooperation with third party users)•Different scope and location of data mart•Some of the pilot findings are:
• Within half of the pilots third party users joined the project
• Within these pilots no data capture had to be performed by the audit team as it was completely automated
• By providing modules of different complexity (query, OLAP, cockpits) more auditors with less technical skills are using analytics.
• Engagement teams were regarded as “the audit teams that are doing the better audit”
Continuous Audit Analysis and Reporting System 4th world continuous auditing and reporting symposiumA. Nutz, E / University of Augsburg University of Salford, April 18th 2002
Pilot Engagements / Findings & Results•Pilot findings (cont.):
• Time savings were achieved by improved integration of modules.
• With standard audit routines time savings for analytic procedures are estimated to approx. 15 to 30 % of time spent for the current ad hoc approach.
• With standard audit routines integrated, AIS will be ‘THE SOLUTION’ and a competitive advantage.
• Especially the use of the OLAP-module improved the image as auditor.
Continuous Audit Analysis and Reporting System 4th world continuous auditing and reporting symposiumA. Nutz, E / University of Augsburg University of Salford, April 18th 2002
CAARS – Next Steps
CAARS
Improved ad hoc capabilities
Improvement of data capture capabilities (mapping facility)
Integration of further modules:• Regression analysis• Trend analysis• Fuzzy logic component
• STANDARD ROUTINES
Data Warehouse Approach
• Enhancement of scalability • Enhancements on fully
automated data capture • Further development on
cockpit and monitoring versions
• PROCESS MEASUREMENT (KPI)
• Audit methodology enhancements
Continuous Audit Analysis and Reporting System 4th world continuous auditing and reporting symposiumA. Nutz, E / University of Augsburg University of Salford, April 18th 2002
• Development of audit standards and business applications
Audit Standards
Continuous Audit Analysis and Reporting System 4th world continuous auditing and reporting symposiumA. Nutz, E / University of Augsburg University of Salford, April 18th 2002
Questions?
• If you have any questions please do not hesitate to contact me:
• 0049 / 711 988 5676
