Navigating the Digital Landscape: A Guide to Digital Auditing
Sumesh Krishna, Partner
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The digital agenda is changing how we live, communicate, and do business in numerous ways, transforming from how they were ten or even five years ago. To succeed as an accountant or financial professional, one must have the capacity to oversee these changes.
To ensure that professional accountants are effective, they must widen their expertise beyond the traditional application-focused approach to the awareness of how technology and data create value for organizations.
Although this digital technology is not new, the pace of change we witness is unthinkable. Businesses have made high investments in their digital transformation. One of today’s popular corporate phrases is “digital transformation.” Companies alter their operating procedures to become more customer- and data-focused.
Impact of Digital on the Workplace
As accountants and financial professionals at the core of organizations, we put ourselves at risk if we fail to understand how technology and the digital journey are changing our workplace.
Five forces are identified as the causes of this influence on the finance industry:
- Velocity – Businesses are changing faster than before, forcing businesses to change as well.
- Volume – The number of transactions rises, and the influence on data flow from the linked devices we currently utilize for business is becoming more crucial.
- Value – the need to gain knowledge, analysis, and prediction from the data flow to better understand and model the company and to use data to assist decision-making more effectively.
- Variety – How technology necessitates us to employ technologies, data sources, and project management approaches (such as agile and Kanban). You are being asked to adapt to several systems and figure out how to optimize them in our jobs.
- Veracity – The dependability, quality, truth, and bias of the data on which we make many business choices, using our ethical lens.
The combination of these five forces implies that the workplace is changing, so the role of accounting and finance professionals in organizations is modifying.
It raises the expectation that people working in business or practice will provide an opinion that indicates an in-depth understanding of the business, considering that the data and technologies available make greater insight more easily accessible.
Changing Business Models
- The result of this transformation is that firms’ business models are altering in response. Successful business models are becoming more integrated across the whole organization, built around the customer journeys the company serves and designed to satisfy the customer needs.
- Effective operation of these models is the way to organizational success, and understanding how technology makes this possible is crucial.
- You must understand how technology supports these processes, how data moves across them, and how company success may be evaluated and modelled as a finance professional.
Digital Skills
It is critical to recognize that digital skills are essential in the workplace, and finance and accounting professionals must embrace the constant need for these. Simply accepting the development that occurs is a vital step, but denying it is risky.
- As digital accountants and finance professionals, you must recognize the value of digital skills in your work.
- It is essential to utilize certificates like the ACCA’s Certificate in Digital Innovation for Finance to develop your skills and expertise.
- As a profession, you can see that the work of the accountancy and finance professional includes a critical need for digital capabilities.
- The challenge is to determine whether you can connect it to the changing business model in the transformed organization and identify those skills.
The digital era enables the chance to interact with the new business model. The future position for the accountant and financial professional becomes solid by developing this skill set.
Developing your Digital Quotient
- The collection of various and distinct levels of skills is defined as a digital quotient.
- As finance and accounting professionals, you must continually invest in your digital abilities if you are ready to fulfil your opportunities.
Efficient accounting and finance professional continues to improve their digital quotient in two areas:- Identifying the digital landscape’s significance to their job and comprehending how the company’s strategy gets implemented through technology – the digital context.
- Using talents connected to the organization’s technology – digital applications.
- Emerging technologies can be of as a third category. These two domains reflect a mix of knowledge and talent, but each necessitates a unique set of possible personal growth strategies.
Four components of the Digital Quotient are as follows:
- Digital capabilities
- Digital Practice
- Strategy
- Existing and emerging technologies
Applying the digital quotient includes using digital skills to comprehend the application environment with current and innovative technologies.
The changing nature of digital in the finance workplace
The financial professional has long been familiar with spreadsheet tools. Their adaptability has allowed engineers to create complex models and simulations. However, like with many tools, enhanced options are becoming available, and failing to adopt them may mean it cannot acquire the amount of insight the company demands.
It is essential to accept the evolution of the technologies used to assist data management and analysis. Preparing financial statements and predictions using assumptions backed by these technologies is a topic that audit and assurance professionals get asked to think about more frequently. Considering their business applications, there is a growing need to raise awareness.
- The scope of these developing technologies and digital audits will continue to broaden.
- The introduction of 5G networks and the possibilities of the Internet of Things influence the next stage.
- For instance, these technologies allow gathering more data from devices in real-time, which opens the possibility of using data analytics more often.
- With the introduction of cloud-based apps that address a specific aspect of a company’s operating model, such as human capital or revenue and clients, the role of the hub is evolving into a central repository of information that is queried through analytical and other tools to provide management information, analytics, and visualizations, often in near real-time.
Must be updated with these changes as finance experts. The accounting system is no longer only a repository of records, as was often believed. With the help of technology, there is a more seamless environment where data get exchanged between apps, and the data repositories that support them get interrogated to facilitate analyses and insights.
Conclusion
The corporate environment is evolving due to digitalization. Evolution is advancing at a faster rate. It is no more a question of whether an organization will become digital but how quickly it will seize the chances and stay relevant to its consumers.
- As accountants and financial experts, you must embrace this digital change and acknowledge that the digital world is evolving to be relevant.
- Traditional digital tools, like spreadsheets, are being replaced by innovative technologies that draw on several data sources, visually portray that data, and use machine learning to predict trends.
- Embrace these changes to guarantee you can use these technologies and adopt new business models.
HLB HAMT to Assist!
HLB HAMT is a independent member firm of HLB International, UK. It is one of the top 10 global advisory and accounting firms. With over 23 years of industry experience and an impressive client base of over 3,000 organizations, HLB HAMT offers expert guidance and assistance to navigate the complexities of today’s dynamic business landscape.
Our audit procedures are tailored to client operations and reporting requirements with a specific focus on each business and industry. The experience of the audit team, covering many industries and service sectors, enables us to focus on critical areas of risk, adequacy of internal controls, and potential areas of fraud.
For any audit-related queries or assistance, reach out to audit@hlbhamt.com
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