Digging for data
Data analytics is rising up the agenda for audit firms of all shapes and sizes. Katharine Bagshaw offer an update for small and medium practices.
Like many emerging technologies, data analytics is a fast-moving area. This can make it difficult for non-experts (in all professions) to keep up with what is available, what is possible and what is practical, but this can be particularly challenging for smaller organisations that cannot easily access or develop specialist skills and resources. Audit firms are no exception.
This article follows on from previous coverage in Audit & Beyond (see box), including a recent John Selwood Q&A addressing some of the many questions he has been asked on analytics for small and medium practices (SMPs). Larger audit firms have been using data analytics within their audit practices for some years now. It is an integral part of their offering and they can no longer tender for listed company audits without a description of how they will use data analytics in the audit. Data analytics services for smaller firms of auditors are now also beginning to develop. To date, data analytics software provided with accounting and practice management systems has focused on analytics for workflow and practice management. The use of data analytics within the external audit is a relatively new area.
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