On or about 19 November 2020, the International Auditing and Assurance Standards Board (IAASB) has published Technology Frequently Asked Questions (FAQs) on different aspects of automated tools and techniques. The FAQs are written in the context of the identification and assessment of the risks of material misstatement in accordance with ISA 315 (Revised 2019).
The publication does not amend or override the ISAs, the texts of which alone are authoritative. It also provides support for the implementation of other standards, such as ISA 230 and ISA 500.
The IAASB uses a broader term called automated tools and techniques which encompasses technologies and tools required for audit procedures.
The questions addressed in the publication are not exhaustive and the examples are provided for illustrative purposes only:
- What types of automated tools and techniques could be used in risk assessment procedures?
- How can automated tools and techniques be used in performing risk assessment procedures?
- How can automated tools and techniques be used to support the auditor’s exercise of professional skepticism when performing risk assessment procedures? Are there any special considerations to demonstrate the exercise of professional skepticism when using automated tools and techniques?
- How can automated tools and techniques be helpful when the auditor is considering the inherent risk factors in the identification and assessment of risks of material misstatement?
- What are the auditor’s considerations regarding the use of machine learning or artificial intelligence by the entity when performing risk assessment procedures?
- What are the auditor’s considerations regarding the use of machine learning or artificial intelligence by the entity when performing risk assessment procedures?
Source: IAASB, accessed 19 November 2020.