Introduction
The audit profession in Australia is undergoing a significant transformation. Traditionally, audits have been retrospective, focusing on financial statements and transactions that occurred months, if not years, before the audit process begins.
However, as businesses demand greater financial transparency and stakeholders push for more timely assurance, the shift towards real-time auditing is becoming increasingly relevant.
What is Real-Time Assurance?
Real-time assurance refers to the ability to provide continuous verification of financial, operational, or compliance-related data using automation, AI, and continuous monitoring tools.
Unlike traditional audits, which occur periodically, real-time assurance enables auditors to analyse financial data as transactions are recorded, identifying inconsistencies and high-risk activities instantly. This is particularly beneficial for fraud detection, where early intervention can mitigate financial losses and reputational damage.
A key enabler of real-time assurance is predictive analytics. By identifying patterns in historical financial data, auditors can anticipate potential risks before they materialise. This shifts auditing from a reactive to a proactive function, allowing businesses to manage financial and compliance risks more effectively.
Integration with financial systems is another critical aspect. Many modern accounting platforms offer API-based access, enabling auditors to extract real-time data directly from clients’ financial records. This reduces reliance on manual data requests and reconciliations, streamlining the audit process while enhancing accuracy.
The Evolving Regulatory Landscape in Australia
As real-time assurance gains momentum, regulatory bodies like ASIC and APRA are beginning to explore how audit frameworks might adapt. For example, ASIC’s focus on audit quality and transparency could drive updated guidelines to incorporate continuous assurance elements.
Meanwhile, APRA’s emphasis on real-time risk management for financial institutions suggests a growing alignment with continuous monitoring practices. Firms embracing real-time data capabilities may be better positioned to meet evolving compliance expectations.
Practical Challenges in Achieving Real-Time Assurance
Despite its benefits, real-time assurance is not yet a reality. Businesses and audit firms face several challenges in transitioning to this new model:
- Many businesses lack the technology infrastructure required for real-time data access and processing. Upgrading legacy systems can be costly and time-consuming.
- Existing audit regulations are designed for periodic audits. The industry needs updated frameworks that accommodate continuous assurance models.
- Real-time data access increases the potential for cyber threats and unauthorised access to sensitive financial information. Businesses must implement robust security measures to mitigate these risks, especially given Australia’s heightened focus on data privacy and recent high-profile breaches.
- While large corporations may have the resources to integrate AI-driven analytics and cloud-based monitoring, smaller firms may struggle with the associated costs. Scalable and affordable solutions are needed to support widespread adoption. Low-cost platforms with built-in automation or phased technology upgrades may help SMEs transition more gradually.
- Many audit professionals and business leaders are accustomed to traditional auditing methods and may be hesitant to embrace continuous assurance due to perceived complexity or lack of expertise. Targeted training programs and incremental implementation can help ease this transition.
Moving Towards Continuous Assurance: A Practical Four-Step Approach
Real-time assurance—the ability to instantly validate financial data and compliance—is not fully possible with current technology and processes. However, businesses and audit firms can take significant steps to improve how they collect, analyse, and review financial data.
By enhancing automation, refining audit methodologies, and integrating smarter technologies, organisations can move closer to a more continuous and proactive approach to financial oversight.
Here’s a structured four-step approach to making continuous review more achievable:
Step 1: Assess Current Processes and Define Improvement Goals
Before making changes, businesses and audit firms must evaluate their existing systems and workflows. The goal isn’t just to adopt new technology but to ensure that data collection and review processes are optimised for more frequent and insightful analysis.
- Review financial systems and data flows to identify gaps that prevent efficient, ongoing monitoring.
- Determine key areas where faster insights could improve compliance, fraud detection, or decision-making.
- Set clear goals for improving data accessibility, automation, and review processes, ensuring alignment with business needs.
Step 2: Enhance Technology and Data Automation
While real-time assurance isn’t yet possible, improving access to timely, accurate financial data is a crucial step. Businesses should focus on modernising systems to support continuous data capture and automated analysis.
- Upgrade to cloud-based financial platforms that facilitate more frequent and accurate reporting.
- Use AI and automation tools to streamline data collection and flag potential risks sooner.
- Strengthen data security measures to protect sensitive financial information while enabling more dynamic oversight.
Step 3: Build Skills and Adapt Audit Approaches
Technology alone won’t bridge the gap—finance and audit teams must develop new skills and rethink traditional audit cycles. A shift towards more regular data-driven analysis will support continuous review, even if real-time assurance remains out of reach.
- Train finance and audit teams on advanced data analytics, automation tools, and AI-driven risk detection.
- Adapt audit processes to incorporate more frequent transactional reviews instead of relying solely on periodic audits.
- Establish a structured process for responding to real-time alerts and irregularities in financial data.
Step 4: Engage Stakeholders and Implement Change Gradually
Transitioning to a more continuous review process requires buy-in from key stakeholders. By introducing gradual improvements, organisations can refine their approach without overwhelming teams or disrupting operations.
- Educate executives, investors, and regulators about the benefits of enhanced financial monitoring.
- Test new systems and methodologies through pilot projects before scaling up.
- Continuously refine data review processes based on feedback and evolving technology.
A Smarter Approach to Financial Oversight
While full real-time assurance isn’t a reality today, businesses and audit firms can take meaningful steps to improve financial data collection, monitoring, and analysis. By enhancing automation, upskilling teams, and refining audit approaches, organisations can create a more dynamic, responsive, and effective assurance process—one that moves closer to continuous financial oversight.
The Role of National Audits Group in Continuous Audit
At National Audits Group, we understand that businesses want faster, more meaningful insights from their financial data. While real-time assurance isn’t fully possible yet, we’re actively exploring new technology that can make continuous auditing more achievable.
We’re investing in tools and upskilling our team to help businesses move toward more frequent, data-driven financial reviews. Automation can improve efficiency, but we believe experienced auditors will always be essential to ensuring accuracy and informed decision-making.
We’re happy to discuss what this shift means for your business and what practical steps you can take to improve real-time financial monitoring. As the audit profession evolves, we’re committed to helping businesses navigate these changes and stay ahead.
Chang Chow
Senior Audit Manager, National Audits Group
