The paper entitled, Continuous Assurance for the Now Economy is intended to stimulate thinking about the issues that need to be addressed in a world where Continuous assurance has become, or aims to become, the standard for both internal and external auditing. The paper examines how the profession must respond so that the vision on IT-enabled real-time auditing is to become a reality.
Continuous assurance - what is it?
Continuous assurance is a concept developed as a result of the 'now economy' which is characterised by 24/7/365 globalised operations, customer interaction and management decision making. Continuous assurance will form an intrinsic component of the now economy by providing key stakeholders with timely and more relevant access to business data, which has a level of assurance placed on it.
Why is it important?
The International standard setter, the International Auditing and Assurance Standards Board (IAASB) has recognised continuous assurance as an emerging methodology which needs to be explored.
Likewise the Institute presented the paper to the Australian Auditing and Assurance Standards Board (AUASB) who recognise the important impact that continuous assurance could potentially have on the profession as a whole, particularly around accounting education, technology, business reporting and the existing skill-set of professional auditors.
What does the paper say?
The paper recommends six practical steps that go some way to delivering the practical application of continuous assurance, including:
- Establish priority areas
- Identify monitoring and continuous audit rules
- Determine the process' frequency
- Configure continuous audit parameters
- Follow up
- Communicate results
I believe that traditional auditing will give way to more progressive and close to the event assurance. It is because of this that we have kick started the continuous assurance debate to create and open up dialogue with key stakeholders.
I would be interested in your thoughts?