Audit automation in the UK and the US: a comparative study

Abstract

The purpose of this paper is to investigate the nature and extent of the use of audit automation by audit firms in the UK and the US. In particular, the paper seeks to identify the significant differences between practices in the two countries. The authors argue in the paper that there are two main forces that might account for these differences. On the one hand, globalization tends to promote similar audit automation practices in the two countries. On the other hand, cultural factors mitigate homogeneity in audit automation practices. The research consisted of a survey of current audit automation practice in large and medium sized audit firms in the UK and the US. The principal conclusions from the research are: (1) that there are differences in the practice of audit automation in the UK and the US; (2) that these differences persist even amongst Big 6 firms. These two conclusions would suggest that cultural differences are not dominated by the forces of globalization. The authors also conclude that (3) the most important benefit of audit automation in both countries is perceived to be improvements in audit quality; and (4) the most important costs across all types of audit firm are training and staff learning time.