How to Prepare for the Future of Audit
This week I participated in the Allinial Global Latin America Virtual Conference, which reminded me of a question I’ve been getting consistently from our member firms around the globe: How should they be preparing for the future of audit, and what is the adoption path for US vs. global firms?
Datev: An Excellent Fit for LATAM
We were fortunate that our key sponsor for the conference was Datev, which has expanded from a German-based audit technology into many other markets, especially in Latin America, as the platform is available in Spanish. Several members were very interested, as they are looking for new and improved options.
The explanation I gave at the conference rings true for many. I offered Datev as a great modern-day solution for those seeking a product in German or Spanish (there is availability in Italy and Poland, but not sure what the translation looks like there). We have several member firms in Latin America using the Datev Spanish version that speak highly of it.
Update on Dynamic Audit Solution (DAS)? What & When?
But what does the future hold? I’ve been informing our members about the AICPA’s Dynamic Audit Solution (DAS) initiative that is looking to transform how audits are done. The initiative started more than two years ago, and it involves over 35 firms working collaboratively to build a solution. We have a number of Allinial Global members involved in DAS, and we are keeping in touch with the initiative’s progress.
What is DAS? Generally, it’s a platform that provides a way to “right size” the audit using contextual content based on logic to get to the right things. The approach is grounded in a “tailor in” vs. “tailor out” mentality so it can increase efficiencies only on the things that matter, rather than trying to justify the things that don’t matter to the engagement. Finally, data capture and data-driven decisions will reduce human error and let the data tell the auditor a story that can then be shared with the client.
I know our member firms have been pleased with the progress of the project. It hasn’t been without pain, I’m sure, but the focus on truly transforming the audit has made it a success thus far. Some of the feedback has been positive, with the project’s focus on continued audit quality and an effective change management system to make this change work for many.
Regarding the timeline, the first release to a smaller universe of firms will come out in September 2021. It will be limited to commercial audit only. The general release is projected for Q2 2022. After the commercial audit product is delivered, the specialty and industry audit guides will be incorporated, along with International Standards on Audit (ISAs).
What to Do Now
So how do I answer the question of what firms should do today? For US-based firms, I tell them to look first at the OnPoint EBP audit module that’s already on the market. Pick one client and one limited-scope EBP audit to run on this new platform. This will give you an indication of what’s coming. For firms outside the US, start to look for CaseWare Cloud. When that comes out and you are already on CaseWare, you may want to make the switch. The system should be more intuitive than many of the desktop applications out there today.
Allinial Global plans to help all of our members when DAS is available to implement in their firms. With members who have already implemented DAS to help lead the charge, we will first assist US-based firms with implementation and then help global firms when a global product becomes ready.
If you’d like to learn more about DAS and the future of audit, we will have a panel of Allinial Global member firms presenting at Summit 2021 taking place from November 14–17 in San Diego. Our panelists will share their experiences and insights from participating in the development of DAS, and I look forward to continuing this conversation there.
