Automated Procedures

Summary

This chapter introduces the application of artificial intelligence (AI) in various tests. The good news for audit automation using AI is that in many cases internal controls tests can also perform substantive procedures. The development of the audit plan for account and transaction testing can be divided into: inquiry, observation, document testing, and reperformance. The standard tools of inquiry are interviews and questionnaires. Audit firms have developed questionnaires that can help understand both control and account issues. Auditors obtain evidence by observing various processes, functions, and job performance of employees. Document testing is about inspecting actual documents related to transactions. These documents are often traced in accordance with the processes and provide the audit trail. Automation of reperformance testing is achieved by using process mining technology to understand the underlying processes, mapping the process steps, and then conducting the testing.