Page 71 - CITP Review

Audit applications of data analytics
Examples of common audit applications include the following:

 Analyzing journal entries and ledger account balances
 Queries for various attributes, such as material transactions or duplicates
 Aging of receivables or payables, or churn analysis of customer or inventory turnover
 Transactional compliance with policy for expenses and approvals

Continuous assurance

Continuous assurance is obtained though the ongoing examination of accounting practices, risk controls,
compliance, information technology systems, and business procedures. Continuous audits automate
error checking and data verification in real time. They can be performed by a firm's internal auditors to
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reduce the year-end workload.
Some advantages of continuous audit include the following:

 Timely and detailed detection of errors or fraud
 Audit efficiency due to more evenly spread out audit tasks
 Improved business aptitude
A common disadvantage is the inefficiency of false positives investigations, which refers to a test result
that incorrectly indicates that a particular condition or attribute is present.

Despite the many advantages, some areas are still open for discussion, including the reliability of data
extracts and the relationship between computer environment and audit reliance.

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See https://www.investopedia.com/terms/c/continuous-auditing.asp. Last accessed September 11, 2019.

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