Despite all its complexities, some CPAs believe the pandemic is paving the way for innovation within accounting audits. They’re crediting it as a force that will accelerate the adoption of artificial intelligence and analytics in the industry that’s long remained confined to spreadsheets and files.
"The power of AI and data mining will be used extensively this year. With Quadient Accounts Payable Automation by Beanworks, I can get the raw data and present it in the form of graphs and charts." – Bernadette Mukuka-Ceant, Accounting Manager, Frenchman’s Creek.
Auditors are making phone and video calls to clients to complete their fiscal financial assessments
Audits in odd times
In a normal year, an auditor would meet staff in the office, or rely on physical records and verifications to make assessments. But with COVID-19 limiting travel, they’re now bound to phone and video calls. For example, PwC audited their client’s inventory through FaceTime. The employee used a phone to live stream from the company's warehouse and give a visual report of the inventory. "Things won't be exactly the same as before, but no one wants this to be the new normal," Michael Paterson from PwC tells CPA Canada.
Physical constraints aren’t the only obstacle in completing an audit in time. Outdated, paper-based accounting practices and remote working have made it difficult to access records. "It’s certainly something that’s challenging," Jon Raphael from Deloitte tells Accounting Today.
Similarly, companies that anticipated the extended uncertainty, but only digitized some parts of the financial workflow, are also facing interruptions eg, vendors are submitting invoices electronically but the accountant is using paper checks to make the payments.
"It really helps a lot during the audit season. We created a user ID for the auditor. They can just go into the platform. I think right now we're about 90% paperless across the company." – Jesusa Agustin, Senior Accountant at Everest
Bringing their audit A-game
Everest Services Centre operates 16 Mr. Lube franchises in Canada with a whopping 1,600 invoices processed per month by only three employees. Considering the volume, a remote audit might have been somewhat tormenting if Everest hadn’t moved its accounts payable (AP) into the cloud.
“It really helps a lot during the audit season. We created a user ID for the auditor. They can just go into the platform,” explains Everest’s senior accountant, Jesusa Agustin who uses Quadient Accounts Payable automation. "We gave the auditor access to generate reports. I think right now we’re about 90% paperless across the company," she claims.
Cloud-enabled AP helped Vancouver's Science World team complete their remote audit without any delays
In other cases, accountants are becoming more proactive in maintaining their company's robust financial health. Douglas Chow, the finance supervisor at Science World, a Vancouver-based museum, says his finance team was working from home for the majority of last year, processing almost 250 invoices per week.
But with real-time access to AP through Quadient AP, Chow has now been running internal audits himself more regularly. “In the old days, it was so much work going through the filing cabinets. You’d have to go through the boxes and storage. Automation makes the audit so much easier,” Chow points out.
“The organizations I’ve seen that are most efficient are the ones that lean fully into the changing processes in the accounting industry. These companies recognize the need to manage change and new technology is ongoing, not a one-time fix,” says Pam Chedden, Principal, SC&H Group.
Some elements of the audit process might seem more problematic for companies that were caught off-guard by the restrictions associated with COVID-19. But as finance experts signal, the crisis will only accelerate adoption of cloud because demand for real-time insights and data exchange has intensified. The supply chain industry faced unprecedented disruption due to the pandemic, but is already starting to harness automation with electronic invoices, influencing other sectors to do the same.
Curious to see how automation makes accounts payable easier?
