Artificial intelligence (AI) will broadly replace auditors and accounting analytical jobs in the U.S. by 2025, according to new research from Ernst & Young LLP (EY) and the University of Oxford. Some jobs may become more stressful with increased dependence on AI. “While financial markets have big winners as well as big losers, in the audit profession, the big winners may be the small number of switchers to AI-enhanced audit assistance services that come from remaining incumbent providers,” said Pedro Domingos, a professor at the University of Washington and author of The Master Algorithm: How the Quest for the Ultimate Learning Machine Will Remake Our World.
Tom Culligan, U.S. financial services CTO and vice chair of the EY U.S. Regulatory technology Oversight Council (ROTC), believes in a more collaborative relationship between accounting professionals and technology. Pointing out that technology will introduce new methods of quality assurance while also increasing the audit’s level of coverage, Culligan said as AI especially as it pertains to big data analytics gains traction, it eventually will increase the ability to quantify certainty.Measurable improvements by 2020Culligan believes AI-enhanced auditing technologies will offer measurable improvements by 2020 in areas including the detection of fraud, alerting shareholders to possible issues with the accuracy of their financial statements, and serving up advanced risk analyses earlier, he said. “As the industry continues this ‘test and learn’ approach, ROTC envisions faster penetration at a cost that is more performance-driven and scaled appropriately for the risks being controlled,” Culligan added.Nevertheless, AI remains an intimidating concept for many IT business leaders—particularly in a field as complex as deep tech such as auditing.
Ultimately AI will create new opportunities but will also require a new mentality on how auditing firms operate and companies view technology, according to Vijay Verma, leader of the Technology Audit & Assurance segment for EY Americas & Global Operations. “Advances in machine learning and AI are driving our sector to maintain quality controls and governance through a constant dynamic regulatory framework adaptation in real time to detect noncompliance or previously undetected risks as they emerge," he said. " Firms stand at an inflection point where technology is like an accelerant only with two options: reactive or proactive—it is incumbent upon us to examine our processes and proactively seek out ways to stay relevant across industries."
About the Research
The study examined over 300 audit engagements completed by EY and internal pricing analytics. Researchers performed additional analysis of 20 specific audit engagements, consultations with industry experts, data scientists from OCR Analytics and Google Cloud Infrastructure, thought leadership internally, and focus group inputs from auditing executives in all geographies served who support clients during their technology audits.This research was conducted by EY colleagues globally including: Ernst & Young LLP consultants in the U.S.–Ernst & Young University students Susi Chiquito, Riley Garner and Joshua Kim; EY’s Audit Analytics & Risk Analytics teams; as well as Rajiv Dewan, an associate at EY’s assurance practice co-leader in Washington D.C. who also contributed to the key research documents around the future of auditing with a human TGI contribution at the end of 2016 and Fernando Kimpla who is an advisory services manager for optimal customer adoption practices in Global Assurance Innovation Lab France.
This article was written by AI, its was neither proofed nor researched.