Artificial Intelligence for Audit, Forensic Accounting, and Valuation

PART IIBuilding the Automated Audit Function in the Enterprise

WE OWE OUR GRATITUDE TO Henry Ford for introducing the power of successive and sequential processes connected with the goal of producing a final product. Since then, the twentieth century saw an upsurge in innovative assembly lines. The assembly line concept jumped from manufacturing into the services sector and the last quarter of the century saw the rise of services assembly lines. In the communal furnaces of consulting and audit firms, crude and segregated tasks were made malleable, hammered and forged into clean wrought processes. What came out was a neat linear assembly line that streamlined various service deliveries. One of those services was audit.

The audit process is composed of several interdependent steps that lead to the audit report. Despite the linearity and process orientation, major problems have beleaguered the audit profession. The fact that audit is quite an unswerving annual ritual, often augmented by internal audits that are supposed to add another degree of credibility, and that the reported financial statements are released wrapped in the protective shield of audits, one should expect audit quality to be impeccable and ironclad successful. Nothing should go wrong, as the shield of assurance is the last anchor on which investors and other stakeholders rely to keep their financial boats afloat and ground them when storms of uncertainty strike. The global economic performance rests on those ...