Technology Audit Research Articles

Application of Big Data Technology in Audit

In the new era of rapid development of big data technology, the three key points of high-quality development of auditing are auditing talents, auditing rule of law and auditing technology. In the traditional audit process, auditors focus on professional judgment and professional competence, make audit plans, implement audit procedures and draw audit conclusions. However, there are many problems in traditional audit work, such as difficulty in obtaining sufficient external information and inefficiency in analyzing audit evidence. Therefore, auditors apply big data technology to audit work to solve various problems and put forward corresponding safeguard measures.

Information Technology Audit in Optimizing Resources and Utilization of Financial Information Systems

Information Technology Audit in Optimizing Resources and Utilization of Financial Information Systems

Strategic Evaluation of Financial Information Systems through Information Technology Auditing

People-based cooperatives encounter digital hurdles to providing effective services. Wiguna Mertha Cooperative needs IT audits to ensure good operations, security, and corporate goals. Enterprise information technology audits are conducted using qualitative and quantitative methodologies in this research. IT audit goal mapping helps firms align business goals with corporate goals, vision, purpose, and IT procedures. PEG aligns IT investments and activities with company strategy, evaluates IT maturity, and prioritizes improvements. Interviews, questionnaires, observations, and documentation were used to analyze 5 cooperative employees' responses. Objective mapping for five corporate goals and maturity level analysis for four COBIT domains: EDM, APO, BAI, and DSS. The results revealed good maturity, with EDM averaging 3.85, APO 3.87, BAI 3.88, and DSS 3.53. Risk management, business resource optimization, IT data up keep, and IT service availability and capacity management are recommended improvements.

Be an Expert: A Critical Thinking Approach to Responding to High-Profile Cybersecurity Breaches

ABSTRACT This case examines three high-profile cybersecurity breaches to illustrate how organizations respond to these situations. Students explore breaches involving Capital One, Equifax, and Target and apply critical thinking to examine attack details, breach prevention, and breach responses by assuming the roles of security consultants, chief information officers, and internal auditors. The case objectives include (1) summarizing how organizations respond to cybersecurity breaches, (2) evaluating threats to organizations’ cybersecurity infrastructure, and (3) justifying how accountants and auditors may respond to cybersecurity breaches. This case is designed for undergraduate- or graduate-level accounting information systems, auditing, information technology (IT) auditing, internal auditing, and fraud examination classes and can be extended for intermediate or advanced financial accounting courses. This case provides instructor flexibility, as the class can be split into three groups with each group assigned as the expert on one breach or one or more breaches can be assigned to all students.

The use of big data and analytics in external auditing: Does audit firm size matter? Evidence from a developing country

Purpose: The aims of this research are to investigate the reasons for adopting big data (BD) and big data analytics (BDA), determine their extent of usage, and identify potential obstacles to their adoption in a developing country, Egypt. Motivation: Prior literature criticized the audit profession for the slow adoption of BDA, and little is known about the adoption of BD and BDA in developing countries. The reluctance to incorporate BD and BDA into auditing can be attributed to their potential obstacles. In addition, prior studies focused on the Big-4 audit firms in developed countries with little known about adopting BD and BDA in local audit firms and developing countries. Design/methodology/approach:To achieve the objectives of this study, 16 audit practitioners with various positions, specializations, and experience levels were interviewed. The 16 participants belong to audit firms of different sizes: international audit firms, local audit firms, and a governmental auditing agency. Thematic analysis was employed through using the MAXQDA software package to analyze the data. Main findings: The findings revealed that the reasons for using BD and BDA go beyond improving audit efficiency and effectiveness and satisfying clients. All audit firms collect and analyze large volumes of traditional accounting data. However, the Big-4 firms manage and analyze non-financial data and new data items as complementary audit evidence. Also, it was found that the type of audit firm affects the use of these technologies, with international firms being superior to other firms. The Accountability State Authority lags behind other audit firms in adopting BD and BDA. Furthermore, it was found that some obstacles to adopting BD and BDA arise due to the specific characteristics of the Egyptian context, while others are universal. Practical implications/Managerial impact: Determining the reasons for and obstacles to adopting BD BDA is useful for audit firms and regulators to remove these obstacles and encourage using such new audit technologies. The findings might help developers of BDA software packages to enhance their packages to meet auditor requirements. Moreover, academic scholars can benefit from the findings of this study by gaining an understanding of the main differences between developed and developing countries in relation to adopting BD and BDA. Novelty/Contribution: This study was conducted in Egypt, a developing country with a an underdeveloped audit environment. Therefore, this study enriches the relevant literature by providing information about BD and BDA in an unexplored developing environment. Besides, it delves deeper into the reasons and obstacles to using BD and BDA in external financial auditing in a developing country. Also, it adds to the literature by identifying the most common BDA software packages and techniques that auditors use in a developing country. Moreover, it considers audit practitioners’ viewpoints on audit firms of various sizes.

The synergistic effect of innovation transfer in the agricultural sector: Regional aspect

The article considers the concept of “transfer of innovations”, taking into account the specifics of the Russian agricultural sector and its basic structural elements. Its stages are highlighted, starting from the technology audit and ending with signing a contract and selling the technology to an interested partner. The reasons for the slow pace of transfer of innovative agricultural technologies and their impact on the effectiveness of the agricultural sector are explored. Promising technology transfer mechanisms in the agriculture are examined, considering their importance for this sector of the Russian economy. The author’s approach to systematization of the main areas for improving the transfer of innovative technologies in the agricultural sector in the country’s regions is offered and their importance to the regional economy is emphasized. The sources of the synergies occurring during the transfer of innovative technologies are identified and further promising research trends in this field are determined.

The Impact Of Big Data In Auditing

As technology trends, society must adapt to the changing environment over time. Many companies have been utilizing Big Data to improve decision-making capabilities and develop strategies for launching new products and services, as they understand the customers’ needs while exploring new markets. Trends in the automation of tasks are inviting more users to further their interest in the noticeable technology development. This paper studies the impacts of Big Data. The paper analyzes the potential benefits, risks, and challenges companies may face in adopting Big Data. With the advancement of technology, audit technology has also improved the utilization of Big Data.

Influential factors shaping the adoption and utilization of audit technology (CAATS) in the audit practices in Saudi Arabia: Human capital expertise as a moderating factor

This study examines the moderating effect of trained human capital on the associations of accounting information systems, generalized auditing software, and technology adoption with the performance of external auditors among Saudi listed companies. This study used a survey-based methodology. The final sample consisted of 136 responses with an 8% response rate. Using Smart-PL4 analysis, the results showed that there is a positive correlation between accounting information systems and external auditors. Conversely, a negative relationship between generalized auditing software and external auditors has been documented. In addition, this study reported a negative association between technology adoption and external auditors. However, the results highlight the positive relationship between trained human capital and external auditors. Overall, this study provides valuable insights for accounting and auditing policymakers on how external auditors’ performance is influenced by several factors in the Saudi audit market.

МЕТОДИКА ВНУТРЕННЕГО АУДИТА КАК ВАЖНЫЙ ИНСТРУМЕНТ РАБОТЫ

The article describes the relevance of the introduction of internal audit at agricultural enterprises in order to successfully develop rural areas. The classification of principles is considered and the functions of the internal control system at agricultural enterprises are defined. The methodology of internal control aimed at improving the performance of agricultural enterprises is proposed. Because internal audit is entrusted with the function of ensuring the integrity of decisions made and their execution, based on information about the activities of the organization, the function of interconnection, informing about the implementation of management decisions. One of its components, food security, plays an important role in ensuring Russia's national security. Ensuring food independence is possible with the effective development of agricultural organizations, which involves both the production of high-quality food products and the implementation of existing in-house reserves. In the context of the increasing role of food security in Russia, the importance of the internal control and audit system in agricultural organizations is increasing. Market relations determine the objective need to increase the role of accounting in enterprise management. Timely, reliable and analytical information is needed to make operational and tactical decisions on enterprise management in conditions of constantly changing market conditions and developing competition among producers. With the development of market relations, accountants were "flooded" with a stream of regulatory documents regulating the legal issues of the activities of agricultural enterprises, the organization and setting of accounting for the latter, the formation of their reporting and taxation. In this regard, it became necessary to create an internal control service at the enterprises of the agro–industrial complex - a form of non-governmental control over the activities of enterprises. Internal audit is entrusted with the function of ensuring the integrity of decisions made and their execution, based on information about the activities of the organization, the function of interconnection, informing about the implementation of management decisions. The main importance of internal audit technology and methodology lies in the constant monitoring of management processes and their analysis. Thus, the problems of effective organization and improvement of the internal audit methodology contribute to increasing the effectiveness of information communication in the management system in order to coordinate economic processes in accordance with the chosen development strategy of an agricultural organization.

ASSESSING THE IMPACT OF INTERNAL AUDIT ON ORGANIZATIONAL SUCCESS

Aim of the study: This research aims to assess the relationship between internal audit and organizational success in the form of corporate goal achievement. Design/Methodology: Under the quantitative research approach, the descriptive research design has been adopted. The reliability, correlation and the regression analysis techniques have been used for data analysis. Multivariate analysis techniques are used to extract a small number of latent variables from a large number of observed variables. Findings: The results suggest that the compliance audit, operational audit, and financial audit, as well as the information technology audit, have a direct impact on organizational success. In a simple way, the internal audit has a direct impact on organizational success. Practical Implications: This research work will help the policy makers in the Saudi Authority for intellectual property (SAIP) to make effective policies that increase the effectiveness of the internal audit. This work also contributes to the available literature showing the relationship between the success of the organization and the internal audit. Originality/value: This study is one of the early and the fewest research works conducted by the Saudi Authority for intellectual property (SAIP), and it is also one of the early studies conducted by using primary data analysis. Keywords: Organizational Success, SAIP, Audit, Internal Audit, Operational Audits, Financial Audit Paper Type: Research Article

Advancements in computer-aided audit technologies: Impact on loan asset quality in banking

The banking sector continually adapts to technological advancements, and computer-aided audit technologies (CAATs) play a pivotal role in enhancing operational efficiency and risk management. This study explores the impact of CAATs on loan asset quality in banking, investigating how these technologies contribute to the identification, assessment, and mitigation of risks associated with loan portfolios. The research delves into the integration of advanced data analytics, artificial intelligence, and machine learning within audit processes, examining their effectiveness in evaluating loan asset quality. Through a comprehensive review of case studies and industry-specific implementations, the study aims to elucidate the practical implications and outcomes of deploying CAATs in banking audits. Key focus areas include the ability of CAATs to detect early warning signs of potential credit risks, assess the accuracy of loan data, and streamline audit workflows. The study also evaluates the role of these technologies in enhancing regulatory compliance, reducing audit cycle times, and improving the overall reliability of financial reporting related to loan portfolios. By understanding the impact of CAATs on loan asset quality, this research contributes valuable insights to banking professionals, auditors, and policymakers seeking to harness the benefits of technological advancements in ensuring the integrity and stability of loan portfolios within the financial landscape.

Peran Strategis Internal Audit dalam Meningkatkan Tata Kelola Perusahaan

This study reveals how internal audit can be a valuable asset in ensuring regulatory compliance, mitigating risk, and improving operational efficiency. Using qualitative research methodology and in-depth case studies, this research identifies internal audit best practices that can be implemented by financial sector companies. The study results show that internal audit has a strategic role in providing confidence to the board of directors and external stakeholders regarding corporate governance. Internal audit is not only a compliance checker, but also a strategic partner who provides recommendations for improving processes and policies. This research highlights the importance of coordination between internal audit, risk management and compliance to achieve common goals in improving corporate governance. Apart from that, this article also emphasizes the need to adopt audit technology and data analysis as an effort to more effectively support decision making. Thus, this research provides an in-depth look at how internal audit can play a strategic role in improving corporate governance, providing valuable insights for practitioners, researchers and stakeholders in the financial sector and related industries.

The Effect of Regulatory Compliance and Digital Audit Adoption on Auditor Performance and Financial Reporting Accuracy in Indonesia

The financial reporting landscape in Indonesia is marked by a complex interplay of regulatory compliance and the adoption of digital audit technologies. This study conducted a quantitative analysis to investigate the relationships between regulatory compliance, digital audit adoption, auditor performance, and financial reporting accuracy. The results revealed a robust positive association between regulatory compliance and both auditor performance and financial reporting accuracy. Regulatory compliance emerged as a vital driver of effective auditing and higher financial reporting accuracy in the Indonesian context. In contrast, digital audit adoption, while promising, did not exhibit a significant impact on auditor performance or financial reporting accuracy. The findings underline the importance of regulatory adherence in fostering financial transparency and accountability, and they offer valuable insights for auditors, organizations, and regulatory bodies in Indonesia.

Problems and prospects in development of digital technologies in accounting and auditing at social enterprises of the Republic of Kazakhstan

The use of digital technologies in accounting and auditing is relevant for Kazakh enterprises, in connection with the development of digitalization of the economy in the Republic of Kazakhstan. The study describes in detail the types of digital tech- nologies in accounting and auditing: blockchain, cloud technologies, Big Data, soft- ware robots and artificial intelligence, the Internet of things. The article studied in depth the essence of each of the mentioned technologies, as well as the level of their use in Kazakhstan accounting. Digital accounting and auditing technologies facili- tate accountants and auditors' work, help to easily obtain primary information, avoid mistakes, and quickly generate financial and management reports. The transition of accounting and auditing to digital technologies has accelerated in recent years due to the COVID-19 pandemic and telecommuting. The article is aimed at studying digital technologies in accounting and auditing at enterprises, as well as the problems and prospects for implementation in accounting and auditing at enterprises of the Republic of Kazakhstan. The study used methods: general scientific, specific, anal- ysis, synthesis, hypothesis, comparison, generalization, observation, induction, de- duction, and abstraction. The main results of the study are the identification of the main problems in the use of digital technologies in accounting and auditing at Ka- zakh enterprises, as well as the prospects for their development and the future from their implementation. The conclusions specify what has already been implemented in accounting and auditing at Kazakh enterprises and list the main ways of introduc- ing the described foreign digital technologies in accounting and auditing. The prac- tical significance of the obtained results will allow enterprises to determine the best digital technology for its implementation in accounting and auditing.

Systematic Literature Review on Auditing Information Technology Risk Management Using the COBIT Framework

Information technology has an important role in carrying out company management activities. It is important that information technology is managed properly so that no risks arise that could endanger the company. Companies can implement information technology risk management through risk management audits. An audit on information technology risk management can help evaluate companies by identifying information technology risks and minimizing information technology risks. Such audits can be carried out with the help of the COBIT framework. This study intends to conduct a systematic literature review on risk management audits related to information technology using the COBIT framework. Literature search from IEEXplore, ScienceDirect and Garuda Kemdikbud database sources. Papers were selected based on inclusion criteria. Inclusion criteria include paper language is Indonesian and English, paper is published between 2019-2023, the paper describes COBIT in IT risk management audits, and paper is available as full text. The results obtained were 24 papers. There are two criteria for assessing paper quality, namely the paper contains the COBIT framework used for IT risk management audits and the paper contains the COBIT domain used. The results of the analysis of research questions indicate that COBIT 5 is a guide used by many researchers in information technology audits for risk management. COBIT 5 provides a complete and comprehensive risk governance guide for measuring enterprise IT risk management. Implementation of COBIT 5 in IT risk management audits to assist in risk assessment and risk management in order to minimize and prevent IT risks that may occur. Domain APO12 (Manage Risk) and EDM03 (Ensure Risk Optimization) as a reference in conducting IT risk management.

Information Technology in Audit Processes. An Evidence from Small Audit Firms in Gombe Metropolis

The use of Information Technology (IT) is becoming increasingly popular in business. The role of IT now hold ace in contemporary business around the world. From sole proprietorship to the desk of the corporate executive IT has completely taken the place or satisfactorily complimented manual data processing. The rapid changes and application of technology have motivated accounting firms to invest in technology to ensure that they are up to date with the current technology. In accounting, technology is broadly used in recording, bookkeeping, generating financial reports, auditing and designing a better costing system for an organization. This study evaluates the determinants of technology adoption among small audit firms in Gombe metropolis. The study adopted the descriptive survey research design and the primary means of data collection was questionnaire administered on audit firms. Descriptive statistics and regression analysis were used to analyse the data. The findings showed among others that individual intentions significantly influence the adoption of technology in small audit firms. The study recommended that principal audit partners should increase their commitment and readiness to provide trainings as well as infrastructure for audit technology adoption by their firms.

Quantitative Evaluation of Assessment Items of the Technology Audit Method for Research and Technology Organisations (RTOs)

Applied research and development (R&D) organisations strive to develop technological solutions that translate results from research and science into state-of-the-art products and services. As advanced technological capability is essential to their competitiveness, they need to be able to analyse and evaluate their technological capabilities. Hence, a tool or method is required that objectively and practically assesses the technological capability of Research and Technology Organisations (RTOs) while meeting their unique requirements. The technology audit enables the assessment of the technological capability and thus the technological maturity of an RTO. It focuses on the analysis of the research activities in the R&D service areas of the RTO. This allows for a comprehensive understanding of the technologies used, the research competencies, the technologies developed, and the established technology partnerships of the RTO. In this context of the development of a suitable technology audit methodology, this paper aims to describe the process of validation of assessment items for evaluating the technological maturity of applied R&D organisations. After a brief overview of the technology audit method and the assessment dimensions and items, the focus is placed on the process of its validation. An expert survey using a questionnaire was created and used to evaluate the relevance of the 11 assessment items for the technology audit instrument in the three dimensions of Technology Base, Products & Services and Cooperation, as well as the respective aspects within each assessment item. This evaluation is intended to validate the selection of the items and to specify their respective importance to ultimately optimise the process of auditing applied R&D organisations.

Аудит в условиях цифровизации: проблемы и перспективы

The global introduction of digitalization in all spheres of society and economy development has determined the need for the transformation of audit and audit technologies based on digital business models and regularly updated information technologies. The article explores the directions of digitalization development in audit, considers its advantages, as well as possible risks and problems. Measures are proposed to overcome risks and problems, and to activate the process of digitalization implementation in modern conditions.

Implications of the COVID-19 pandemic on internal auditing: a field study

PurposeThe purpose of this paper is to examine the implications of the COVID-19 pandemic on internal auditing as the pandemic forced individual internal auditors and audit teams to conduct the work remotely.Design/methodology/approachFive in-depth semi-structured interviews of internal audit experts that work in German retail and manufacturing industry were conducted between February and April 2021.FindingsThe authors find that the importance of audit technologies did not change significantly due to the pandemic, as audit technologies were already an integral part of internal audits. Interestingly, the transition to remote audits occurred with remarkable speed and efficiency. The presence of well-functioning information and communication technologies emerges as a critical facilitator for effective remote communication, collaboration and data exchange. However, audit technologies can only partially replace physical on-site examinations and human interaction. The main challenges of remote audits are related to the auditing of non-digitalized processes and the inherent limitations of auditee interviews and interactions.Research limitations/implicationsThe authors' interview approach does not allow to cover variations between industries and between countries. While internal audit experts provided notably consistent responses during the interviews, acknowledging that the sample size is very small is important.Practical implicationsThe COVID-19 pandemic serves as a catalyst for increased digitalization and technology adoption within the realm of internal auditing. A hybrid approach combining the benefits of on-site and remote audits is expected to prevail in the future.Originality/valueThe paper is among the first to document the effects of the COVID-19 pandemic on the work of internal auditing using field-based research methods.

The Importance of COSO Framework Compliance in Information Technology Auditing and Enterprise Resource Management

This article examines the significance of the COSO framework in managing risks and establishing effective control environments for organizations' IT systems. It delves into the five essential components of both the COSO frameworks for internal control and enterprise resource management. Furthermore, it outlines the principles that define each of the COSO frameworks for internal control and enterprise resource management components and elaborates on their impact on the COSO framework objectives. The authors also shed light on the paramount concerns of an auditor during an IT audit. In conclusion, the article provides several recommendations for integrating COSO framework compliance into an organization's information technology plan. This articles a valuable resource for auditors, administrators, and management seeking to develop an IT strategy that aligns with their business strategy and safeguards their information systems and data.