The COVID-19 pandemic has reshaped how businesses operate, and auditing is no different. Remote auditing, initially a necessity during the pandemic, has now become a standard practice. This shift is transforming production processes and client relationships, emphasising the need for advanced technology, flexible work environments, and data analytics.
1. Evolution of Remote Auditing Since COVID-19
Remote auditing uses technology to conduct audits without being on-site, leveraging digital tools for document reviews, virtual meetings, and even remote site inspections. Before the pandemic, audits were mainly done in person. Auditors would visit client locations to review financial records, inventory, and other key documents. COVID-19 forced a quick transition to remote auditing to adhere to lockdowns and social distancing.
A recent Institute of Internal Auditors report highlights the pros and cons of remote auditing. Key advantages include instant communication via video calls, reduced travel costs, and easier involvement of external experts. However, challenges like limited in-person face-to-face interactions, potential cybersecurity risks, and difficulties in verifying physical inventory remotely also exist.
Despite these hurdles, remote auditing has proven to be a resilient alternative, maintaining continuous auditing processes even during global disruptions. This flexibility is especially valuable in an environment where recruiting and retaining auditors is tough.
2. Improving Production and Enhancing Client Relationships
Effective communication, strong technological infrastructure, and strategic client engagement are crucial for enhancing production and client relationships in a remote auditing environment. Leading audit firms focus on both system development and staff training.
A solid virtual infrastructure is the foundation of efficient remote auditing. This includes cloud-based solutions for data management, secure communication tools, and collaborative software. Cloud technology allows real-time updates and seamless access to client data ensuring auditors can work, individually or collaboratively, as effectively as if they were on-site.
While remote auditing reduces physical interactions, maintaining a human touch is essential. Regular video calls can replace face-to-face meetings, preserving the visual and vocal elements of communication that are vital for building trust with clients. Remote auditors also need to be good listeners, fully understanding client concerns and expectations. This involves creating opportunities for feedback and keeping communication lines open to foster a collaborative relationship.
3. More Time for Data Analytics and Review, Adding Value
One significant benefit of remote auditing is the extra time available for data analytics and review. Traditional audits often involve a lot of travel and logistical arrangements. Remote auditing minimises these time-consuming activities, allowing auditors to focus more on data analysis and providing value-adding services.
Advanced analytics and AI-powered tools can revolutionise auditors’ work. These technologies enable in-depth analysis, pattern and anomaly identification, and strategic insights for clients. This shift from transactional to analytical work enhances the value delivered to clients, positioning auditors as strategic partners rather than just compliance checkers.
Remote auditing tools and data analytics can also improve fraud detection. By quickly and accurately analysing large datasets, auditors can identify unusual transactions and potential risks more efficiently, safeguarding client interests.
4. The Importance of a Flexible Work Environment
The pandemic highlighted the need for a flexible work environment, which has become crucial for attracting and retaining talent. A flexible work environment offers several benefits:
- Work-Life Balance: Flexible work arrangements help auditors achieve a better work-life balance, reducing stress and increasing job satisfaction. This leads to higher productivity and lower turnover rates.
- Diverse Talent Pool: Remote work allows firms to tap into a broader talent pool, including professionals from different locations and non-traditional backgrounds. This diversity brings new perspectives and skills to the auditing process, enhancing overall effectiveness.
- Resilience and Continuity: A flexible work environment ensures business continuity during disruptions. By establishing remote work protocols and technologies, firms can maintain operations and client services even in unforeseen circumstances.
- Key Challenges and Solutions
Despite its benefits, remote auditing presents several challenges. Addressing these challenges requires strategic solutions:
- Cybersecurity Concerns: With more reliance on digital tools, cybersecurity is crucial. Firms must implement robust security protocols, including encryption, secure access controls, and regular security audits to protect sensitive client data.
- Bandwidth and Connectivity Issues: In some areas, limited internet bandwidth can hinder remote auditing. Firms can mitigate this by investing in reliable internet services and contingency plans for connectivity issues.
- Verification of Physical Evidence: Remote audits make it challenging to verify physical inventory and documents. Solutions include using real-time video inspections, requiring clients to provide detailed digital records, and employing third-party verification services when necessary.
- The Future of Remote Auditing
The future of remote auditing looks bright, with continuous technological advancements and evolving work models. Here are some anticipated trends:
- Increased Use of AI and Machine Learning: AI and machine learning will play a larger role in auditing, automating routine tasks, and enhancing analytical capabilities. This will allow auditors to focus on more complex and strategic aspects of their work.
- Greater Emphasis on Cybersecurity: As remote auditing becomes more prevalent, firms must prioritise cybersecurity measures to protect client data and maintain trust.
- Hybrid Audit Models: The future will likely see a blend of remote and on-site audits, allowing firms to leverage the benefits of both approaches. Hybrid models will provide flexibility while ensuring thorough verification and client engagement.
- Regulatory Frameworks: As remote auditing becomes standard practice, regulatory bodies are developing specific guidelines to ensure consistency and reliability. These frameworks will provide clear expectations for remote audits, enhancing their credibility and acceptance.
Remote auditing has transformed the auditing landscape, offering numerous benefits while presenting unique challenges. By leveraging technology, promoting flexible work environments, and focusing on data analytics, firms can enhance production and client relationships.
National Audits Group: Fostering Adaptability and Nurturing Work-Life Balance
The changing landscape of remote working has helped to reshape our operations, including expanding our capacity to attract talent from diverse backgrounds. Our Flexible Work Solutions enable us to craft bespoke employment arrangements, each of which can be crafted to accommodate the unique needs of each employee, fostering a harmonious blend of professional and personal responsibilities. Furthermore, our “Staycation Initiative” extends the opportunity for remote work, even across international borders, enabling our employees to maintain productivity amidst unforeseen family circumstances.
With our Flexible Work Hours Agreement, we acknowledge and compensate for overtime, helping us to prioritise the well-being of our team and help them sustain a healthy work-life balance. We also recognize the importance of individual circumstances, offering tailored solutions including, for example, flexible scheduling during school holidays, phased returns following maternity leave, and even 9-day fortnights.
At National Audits Group, we place immense value on cultivating robust connections and meaningful relationships both internally, with our team members, and externally, with our clients. We believe that fostering strong relationships is paramount to mutual success and satisfaction. In essence our ethos revolves around fostering an environment where work and home lives healthily coexist.
Harnessing cutting-edge technology we strive for continuous improvement, working together as a team to deliver comprehensive audits that transcend traditional boundaries, positioning ourselves as trusted strategic partners to our clients.
National Audits Group: Incorporating Remote Auditing in Audit Practice
The team at National Audits Group services clients throughout Australia and the South Pacific region using auditors in multiple office locations. They have gained significant experience in performing quality audits using online technology to access people and data.
Additionally, the use of advanced data analytics and AI tools allows National Audits Group to deliver insightful, value-added services that go beyond compliance, positioning them as strategic partners to their clients.
To discuss these issues further, contact us directly on 1300 734 707 or email info@audits.com.au
William McConnell | External Auditor, National Audits Group
William’s industry experience ranges from charitable organisations to construction, equipping him with sound knowledge for a diverse range of SMSF audits.
