It is a capital mistake to theorize before one has data
- Arthur Conan Doyle
Data is the unit of being of any organization. Data is to an organization like a cell is to a human body. With data being bombarded from various sources, organizations have reached a point of Data Overload.
Traditionally, data was created in a structured format, but with the outburst of Social Media, organizations have been receiving data in various unstructured forms (like e-mails, tweets, audio recordings etc.). Data obtained from such informal means is just as crucial as conventional data. Together, structured and unstructured data sources have led to the era of Big data. Big data Analytics is the current trend which is revolutionizing the Business world.
One may not have estimated the impact of big data in the field of audit. It is generally perceived that science and technological advances of such nature would not affect Audit as a process. But, this general rule does not apply to Big Data. Big Data Analytics provides an opportunity to bring the necessary changes to the traditional approach of carrying on an audit. It helps an Auditor to widen the scope of an audit and also makes it easier to unmask any anomalies.
Application of Data Analytics will help Auditors to correlate the financial information with the informal/unstructured data for greater insight. A simple e-mail or tweet could disclose a well-hidden fraud. Many may argue that auditors are required to limit their scope to Financial and Operational data, but that’s not an option in today’s world which is obsessed with Social Media. It has become alarmingly necessary to adopt an exhaustive approach.
We can bear the fruit of Data Analytics only when the Standards on Audit are updated. These standards need to be in line with the current requirements of Data Analytics, only then, can we utilize big data analytics to its fullest. Until such time, the best we can do is wait and be adept with the updates in the field and believe in time to be the best healer.
Author
Dweepshi Gupta
Dweepshi Gupta is an article trainee at K. Vijayaraghavan and Associates. She aspires to become a Chartered Accountant. She is fascinated by the Corporate world and is eager to gain expertise in it.
