AUDIT 4.0 – DIGITAL ECONOMIC AUDIBLE The use of innovative technologies changes auditing and auditing

AUDIT 4.0 – DIGITAL ECONOMIC AUDIBLE The use of innovative technologies changes auditing and auditing

Technological change poses new challenges for the finance functions and puts auditing under pressure. Only those who are involved in digital innovations will withstand this pressure in the future and increase the quality of financial reporting and auditing.


Global complexity and data security and transparency requirements are increasing. In this environment, companies strive to consolidate and expand their credibility vis-à-vis all stakeholders. Their desire for more information increases in parallel with the amount and availability of report-relevant data. To meet this desire, the need for Mehrin¬formationen must be adequately addressed. This means that in the prevailing flood of data, companies clearly and unequivocally separate the data relevant to their governance and financial reporting from irrelevant ones. They are therefore well advised to strengthen their confidence in their performance, the associated financial reporting and the underlying data. The audit not only represents a legal necessity, but also the main pillar of trust.


The first industrial revolution introduced water and steam power; the second is electrical energy and the third is electronics and information technology. In the fourth industrial revolution – also known as Industry 4.0 – we are encountering a world of digital revolution in which digitization, networking and automation will increase productivity and expand the value chain. Derived from Industry 4.0, Audit 4.0 will automate and digitize the annual audit based on new technologies such as Big Data Analytics and Machine Learning, as well as Vernet

sought by global audit teams due to modern communication platforms.

Technologies like the Internet of Things or Cloud Computing are forcing companies in all industries to fundamentally rethink their business models. At the same time, they enable innovations that on the one hand offer good opportunities for growth, but on the other hand can also threaten traditional business models.

In order to meet customer needs in the long term and not to miss out on their competitors, companies must react to the far-reaching developments of a digitized world. The digitization and networking of finance functions and accounting play a key role here.

Even the audit companies must not overslept this change. They must observe the development of their customers in real-time and take into account the influence of digital transformation in the business environment of their customers in their audit work. This will only succeed if the audit companies digitize themselves and develop at least at the same speed as the companies to be audited. In order to create added value for stakeholders and customers in the long term, the test companies must even be one step ahead of this development.


Big data and data analytics, communication platforms, automation and visualization technologies are currently the most important ones for digital auditing

technological innovations. The aim is, based on digitization, automation and correspondingly more comprehensive insights into the data volume, as well as more automated processes, to conduct the audit in a more timely and qualitatively superior manner and at the same time to reduce the risk of errors from manual interventions.

Not only companies, but also audit firms should investigate the use of new technologies in digital auditing and thereby increase test quality and efficiency. The technological innovation fields of the world 4.0 according to the illustration can help here. Some of these technologies are future music, others are already reality or at least in the planning phase.

Automation or support of transaction checks. The quality of an audit can be improved by using data analytics. With a Data Integrated Audit, it will be possible to analyze 100% of the population of test areas in different dimensions. Properties of high and complex data volumes can be evaluated, modeled and visualized for unusual facts, trends and irrational correlations. This makes it easier to detect deviations and inconsistencies. At the same time, this is a great help for the random checks, since the sample selection is now risk-oriented –

Outliers can be specifically included in the selection of the random sample.

In the bank audit, IT tools are already being used to check profit and loss items such as commission and interest income. Previously, these positions could only be reconstructed manually with an unstructured selection and using a random sample. Recently, a 100% structured analysis of transactions is available. Not only does this allow the population to be audited, but it also allows for the identification and inclusion of all outliers in the sample for detailed audits (eg, too high or too low interest and commission payments). That’s just the beginning. In the industrial sector as well, performance accounting items are tested in a similar concept using, for example, Computer Assisted Audit Techniques (CAAT).

Automation of process and Kontrollprüfun¬gen. Today, IT tools are already being used in the audit, with which customers in an SAP environment can analyze their processes and automated controls on design and effectiveness on the basis of visualizations and simulations and identify weak points. This allows specific process and ICS optimizations to be developed and implemented. Due to the automation and the reduction of manual process and control checks, the final exam takes time. In addition, the audit strategy is improved as the scope of audit-related audit actions decreases due to the higher reliance on control reviews.

Robotic Process Automation (RPA). This term describes robot-based process automation that mimics manual actions and automates repetitive tasks across multiple process or processing steps. RPA eliminates repetitive and standardized tasks. The audit uses RPA to automate manual documentation steps in the documentation chain between local customers or local auditors to the group auditor and their documentation obligations. As a result, administrative and less profitable processes become more efficient.