Data analytics is the process of systematically applying statistical and/or logical techniques to describe, condense and evaluate data. Nexia New Zealand has recently adopted new data analytics software known as IDEA, with our overall goal being to enhance our computer-assisted testing to provide a more holistic or “big picture” approach without impacting our required levels of assurance.
We operate in an industry where there is often an abundance of data and information available, however the true potential for this information is vastly underutilised without the skills and data techniques to draw out the trends and behaviours that directly influence business outcomes analytics.
The competitive advantage of having access to such powerful software is in our ability to work both cost and time efficiently.
But it’s not just about doing things faster. Data analytics is about bringing multiple sources of data and non-financial elements to the risk assessment process, to enhance our interpretation and utilisation of available information. This provides a competitive advantage to our clients as it enables the audit process to:
- More accurately identify inconsistencies, irregularities, or fraud.
- Draw out insights and recommendations, making the overall audit process and outcomes more valuable to our clients.
It’s about getting the outcomes that matter faster and spending more time on them instead of ploughing slowly through random samples that often tell you very little.
In addition to the above, there is quite often a ‘gap’ between client expectations and audit scope. Typically, to provide clients with value-add reporting requires significant work, without contributing to audit evidence. IDEA not only allows us to collate strong audit evidence, it also significantly enhances the additional value for our clients, with a minimal sacrifice to audit efficiency.
Ultimately, the tools we are currently creating will allow us to reduce the ‘gap’ between audit evidence and client value. This is achieved by automating, and standardising our audit procedures, enabling us to analyse large volumes of data to identify risk areas, inconsistencies and provide valuable insight and recommendation to aid our clients with achieving their business objectives and reviewing their internal control processes.