Audit Strategy Leverages Digital Transformation
A firm’s audit strategy moving forward must include a digital transformation. Without a doubt, the move towards end-to-end, cloud audits has been underway for some time. Even more, the COVID-19 pandemic has highlighted the need for 100% digital auditing with the ability for teams to collaborate remotely.
Today, there’s an incredible opportunity growing for firms to leverage emerging technology and evolve their audit processes for greater efficiency, higher quality, and better profitability. Not only will digital transformation enhance quality and drive efficiencies, but it will also allow firms to service clients in a way that simply wasn’t possible before.
In a recent podcast, Cathy Rowe, Director of Technology Product Management discussed this topic, and specifically focused on Wolters Kluwer’s audit strategy and product roadmap for the CCH Axcess audit solutions. Listen to the podcast.
What does a data-driven audit look like?
Now, imagine being able to collect data from clients automatically and feed it directly into your audit. Integrated audit solutions then help auditors understand the client and identify risks auditors should address. The audit plan is perfectly tailored to respond to identified risk with procedures performed. Auditors focus their time on analyzing results. They can see the audit evidence is sufficient and appropriate to support their opinion and that disclosures are complete and accurate. This is the digital transformation required for the audit profession, and Wolters Kluwer has a technology roadmap to accomplish it.
Drive audit and tax engagements from the cloud
First, the building blocks of digital transformation are cloud, data, and automation. Because cloud solutions will support the end-to-end workflow for audits, consequently, firms will need cloud tools to help manage financial statements and documentation. For example, auditors currently use CCH ProSystem® fx® Engagement to organize workpapers and drive engagements. But soon, auditors will employ CCH Axcess™ Engagement to manage digital engagements in the cloud, including “no touch” business tax returns.
Firms that have used CCH ProSystem audit solutions are sure to like CCH Axcess Engagement. To start with, it will feel familiar, replicating the familiar workflows for auditors. Next, CCH Axcess Engagement is a true cloud solution, delivering real-time updates and anywhere, anytime access. Future product plans even call for the inclusion of an offline mode. Third, the solution will remove manual steps by leveraging emerging technology, such as AI, for intelligent grouping of accounts and automated report creation. Additionally, firms will benefit from direct integration with client accounting systems and significant improvements to consolidations. Of course, as part of the CCH Axcess platform, auditors can send balances effortlessly between the audit and the tax return.
Employ a risk-based audit methodology
Next, firms need an audit methodology to guide the auditor. CCH Axcess™ Knowledge Coach takes the award-winning and patented risk-based audit methodology of CCH® ProSystem fx® Knowledge Coach to the cloud. It was launched in 2019 for commercial audits. Its tailored approach offers robust diagnostics to help auditors effectively address risk while avoiding over-or-under auditing. What’s more, auditors benefit from real-time updates for team members with in-line diagnostics in Knowledge Coach.
Furthermore, CCH Axcess™ Knowledge Coach PCR provides this same risk-based methodology for preparations, compilations, and reviews, with only the prep, comp and review industry titles needed.
Streamline audit data analytics
Additionally, an end-to-end audit workflow requires data-driven elements that support analytics. Accordingly, TeamMate® Analytics represents an important part of the audit strategy built into the Wolters Kluwer Integrated Audit Approach. Further, it will soon be part of Wolters Kluwer integrated cloud solution, CCH Axcess ™ Audit.
TeamMate Analytics empowers auditors to start incorporating analytics with a library of over 200 tests. Features like the expert analyzer help firms streamline analytics on all engagements. Auditors can use visualizations during audit planning and client communications. Even better, Knowledge Coach provides this information to help auditors understand where analytics can be used.
Client collaboration and data ingestion tools remove barriers to efficiency
Undeniably, a lack of client readiness can have a negative impact on audit profitability. The Engagement Organizer feature in CCH ProSystem® fx® Engagement disrupts the traditional data gathering process. This cloud-based request list provides auditors with a simpler means for requesting, receiving, and tracking documents with clients. Engagement Organizer is a core feature in CCH Axcess Engagement, too. But client collaboration will not stop there; future plans include dynamic engagement letters as well as the ability to invite clients to complete or review key forms.
Also, many firms spend too much time ingesting client information into the software solution. CCH Axcess™ Financial Prep, however, is the first dynamic cloud-based trial balance solution integrated with Xero, QBOnline, CCH Axcess™ Workstream, and CCH Axcess™ Tax. It forms the core engine of CCH Axcess Engagement, and introduces automation using direct integration with client accounting systems as well as machine learning to group and assign tax codes. And, auditors can send trial balances straight to CCH Axcess Tax – one step closer to a “no-touch” tax return.
Technology roadmap for the future of audit
So, where does the technology roadmap stand for Wolters Kluwer’s digital audit strategy? Well, most cloud solutions are already in place, including CCH Axcess Knowledge Coach, CCH Axcess Knowledge Coach PCR, CCH Axcess Financial Prep and the Engagement Organizer feature. Then, currently, CCH Axcess Engagement is in a beta program and TeamMate Analytics will soon be incorporated into CCH Axcess too. Therefore, Wolters Kluwer anticipates making the entire integrated end-to-end cloud workflow, known as CCH Axcess Audit, available in 2021.
Listen to the podcast, and stay tuned for more information about the future of audit strategy.