The Center for Audit Quality (CAQ) recently published an article on its website titled "Auditors and Artificial Intelligence in the New Era of Auditing". The article points out that the auditing industry is undergoing significant changes due to the rapid development of artificial intelligence. Artificial intelligence is no longer a concept of the future, it is affecting financial reporting and even the entire auditing industry. Although artificial intelligence brings new tools to auditing, for auditors of listed companies, this change emphasizes a long-term responsibility: to maintain trust in auditing in the capital market.
Auditors' supervision of artificial intelligence can build trust and confidence as emerging technologies are integrated into workflows, especially when investors are increasingly concerned about the transparency of AI applications. The latest institutional investor survey by CAQ shows that as companies widely apply artificial intelligence technology to accounting, operations, and disclosure fields, regulation of artificial intelligence has become the primary concern for institutional investors.
Human factors still dominate
Although artificial intelligence has significant advantages, our participation is crucial. We can integrate manual supervision through the following methods:
●Review and Verification: Experienced auditors maintain professional skepticism and apply professional judgment to carefully review and verify the results generated by artificial intelligence to ensure their accuracy and completeness.
●Interpretability and Transparency: We prioritize explainable artificial intelligence and gain a deep understanding of the decision-making process of AI systems to ensure transparency and comprehensibility.
●Reduce bias: We actively avoid potential biases in artificial intelligence systems and value the fairness and objectivity of audit procedures.
●Professional ethics considerations: Professional ethics considerations are the focus of artificial intelligence implementation strategies.
Artificial intelligence is a powerful tool for enhancing audit capabilities, but the foundation of audit quality, integrity, and credibility always stems from the experience, judgment, and professional ethics commitment of auditors.
Building trust through transparency
Transparency is crucial for AI driven auditing. Artificial intelligence is revolutionizing financial statement auditing in the following key areas:
●Improving accuracy and efficiency: Artificial intelligence tools automate routine tasks such as data entry, adjustment, and report generation, greatly reducing the risk of human errors and allowing auditors to focus on handling more complex work, thereby improving audit efficiency and the quality of financial reports. Through full dataset analysis (rather than sampling), artificial intelligence further enhances accuracy and can identify small outliers that may have been overlooked.
●Optimize risk assessment: Artificial intelligence algorithms can analyze massive amounts of data to identify patterns and outliers that may indicate the presence of risks or fraudulent activities. Predictive analysis is a rapidly developing field that enables forward-looking risk identification and assessment.
●Real time guidance: Utilizing artificial intelligence to provide real-time advice to auditors, assisting them in improving the clarity and completeness of their work papers in accordance with audit guidelines. Real time guidance not only improves the quality of working papers and streamlines the subsequent review process, but also promotes the personal development of auditors.
The key to using artificial intelligence is that auditors must always be at the core of the process. Investors are concerned not only about whether companies use artificial intelligence, but also about whether AI technology is properly managed and whether it introduces a human cognitive perspective. The independent supervision of auditors can strengthen trust in audit work and enhance investor confidence, thereby contributing to the development of the US economy.
Industry Future
The use of artificial intelligence is not only to improve efficiency, but also to fundamentally change the nature of the auditing industry. Auditors need to develop new skills in order to effectively utilize artificial intelligence tools and interpret the results they provide. This requires auditors to be committed to continuous learning and brave enough to try emerging technologies. The auditing industry is moving towards a more data-driven and analytical approach, which requires a higher level of technical experience. However, core values such as professional judgment, critical thinking, and ethical behavior will still be crucial.