Effective use of technology for in-house audit processes could help prevent accounting fraud in a company, as it will be easier to monitor the flow of data online, says global consultant PricewaterhouseCoopers.
A new PwC report, ‘2010 Internal Audit State of the Productivity of the Profession Survey’, said that about 48 per cent of Indian companies lack skill and knowledge of data tools used in internal audit softwares, while 18 per cent have no access to these tools.
“With a predicted increase in scope and responsibility and heightened focus on risks, it is essential that internal audit functions prioritise focus, employ smarter resourcing and skill models and use technology as an enabler,” PwC India Executive Director Satyavati Berera told PTI.
However, a number of internal auditors in India are not convinced that technology has a measurable benefit, with 38 per cent of the respondents to PwC’s survey unable to calculate the benefit.
Of the companies that saw benefits in the use of information technology, 38 per cent said it provides greater coverage, 28 per cent talked about targeted risk testing, 18 per cent were eyeing efficiency and 17 per cent were keen on the ability for continuous monitoring, the study said.
PwC suggested that companies can initiate a pilot project for a technology—enabled audit methodology or audit lifecycle so that an assessment can be made about the opportunity for technology to enhance and streamline that process.
“It is important for raising the performance bar because this year’s survey results indicate that auditors at present are not convinced that technology has a clear benefit,” PwC said.
The role of internal audit processes hold significance in India in the aftermath of the Rs 10,000 crore accounting scam at Satyam Computer Services that was brought to light in January last year by the IT firm’s founder and the fraud’s perpetrator, B Ramalinga Raju.
The firm’s internal audit team head V S Prabhakar Gupta, was booked by the CBI for being party to the crime - the largest in India’s corporate history.