Every person who has delved deep into the business world knows the importance of doing an internal audit of the company. An internal audit will not only help the management to understand the present situation of the company but will also allow them to take control of the current condition of the company and make decisions for the betterment of the company. The better the quality of information is, the better are the various insights. This has led to a shift in the company from using audits to generate data to conducting an audit using the data procured by multiple methods.
The companies gradually understand the importance of ‘Big Data' and ‘Data Analytics' and how to leverage them.
What is Data Analytics?
Data Analytics refers to the process of scrutiny of sets of data which will help the management of a company to get to a conclusion and then make a decision accordingly. These sets of data are acquired usually after performing several procedures and after utilizing various software and systems. The use of data analytics is generally to find the bottlenecks in the working of a company, but this concept can be applied to almost every company.
Data Analytics can be used by content-based companies to find out which content works for a demographic of people and keep you clicking on their content, and it is used by gaming companies to help set reward schedules. Data Analytics will also allow the management to understand what is the trend of a particular market and the administration can take decisions accordingly.
Data Analytics in Internal Audit
The better is the quality of data available to the auditor, the better results he will be able to produce. The audit companies have understood the importance of Data, and as a result, they have increased their investments in the field of data analytics and data mining. The increasing utilization of the Enterprise Resource Platforms (ERP's) has much helped in the use of data analytics as these systems help automate the necessary processes used in the Audit Services and also decrease the need for the integration and reconciliation of the data across the various platforms and different systems.
It is to be taken care that a businessman utilizes the Data appropriately and does not overuse the data. It the insights that have been derived by the scrutiny of the data are not adequately followed, or there is a mistake in the examination of the data, the management can take wrong decisions concerning the future of the company which will jeopardize the future of the company. Thus it is always recommended to avail the services of an audit firm who are well versed in the use of data analytics for internal audit.
Benefits of Data Analytics in Internal Audit
There are many concrete benefits of using Data Analytics in the Internal Audit Process. These benefits are as follows:
1.Greater Coverage of Audit
This means that there is an increase in the sector and the types of companies in which the audit conducted. As data analytics and be applied almost into every industry, the option of doing an audit for various sectors will increase the relevancy of the auditing firm and will provide an all-round understanding of the business environment.
2.Saving of Cost
With an increase in the quality of data, the auditing firm will be able to decide without investing much of the resources and funds into a particular process.
3.Increasing the Effectiveness
As the auditor will be having the overall knowledge of the business environment, he will be able to factor in the various other issues while conducting an audit of a company.
4.Conducting an Efficient and Accurate Internal Audit
The final results obtained from the audit process will be spot on as the auditor will be utilizing the sets of data with better quality. This will help the company to better use all the resources and will also increase the accuracy.
5.Judicious Utilization of Resources
The availability of useful quality data will allow the auditor to help understand which function of the company needs attention and how much resources will be required.
This means that the Internal Auditor can reach a better result as now the auditor can test more immense proportions of transactions instead of conducting a periodic review of all the controls and risks which are based upon the evaluation done at specific periods.
7.Less Time Taking
As the auditor will be dealing with the better quality data, they will be able to reach to the conclusion at a faster pace. This will allow the auditor to take less time in conducting the audit and will also increase the number of clients he can handle at a given period.
There are several tools and vendors available in the business environment, which will help the company to collect data which can be used by an auditor. These tools range from simple and easy to use tools such as MS-Excel, MS Access, etc. to complicated but useful tools like SQL, Oracle, Tableau, etc.
If you are looking for an Auditing firm in UAE which will utilize modern tools to provide accurate auditing information then look no further, JAXA Chartered Accountants can help you in this matter. JAXA is and Auditing and Accounting firm which will take care of all the auditing requirements of the company. It also provides a range of other services which will help in the growth of your business. For more details, Contact Us. We will be happy to help you.