Data Science & Audit – Asset or Adversary?

Data scientist is the sexiest job of the 21^st century, according to the Harvard Business Review. Their ability to transform large amounts of messy, unstructured data into something meaningful has made them one of the most sought-after assets among emerging and established companies. Last month, we asked CaseWare IDEA® users to share their views on how data scientists are impacting the role of audit professionals working with data analytics.

Professionals with experience working on machine learning, programming systems, developing algorithms and working with large-scale systems are in high demand. Data scientists and advanced analysts are among the fastest-growing roles. By 2020, the number of jobs for all U.S. data professionals will increase by 364,000 openings to 2,720,000, according to IBM.

The majority, 83 percent, of IDEA users consider data scientists an asset to their role. Most audit professionals view data analysts and scientists as viable resources, working alongside them to achieve effective and efficient results.  They add a professional view, share knowledge and increase the visibility of internal audit – without replacing the role of auditors.

Most see data scientists as partners, helping expand their capabilities and skills to perform “smarter” audits. Their expanded expertise helps auditors identify areas of concern and gain deeper insights that might otherwise be missed using traditional auditing techniques. From interpreting data to streamlining procedures, most IDEA users welcome close collaboration with data scientists.

“For auditors to realize fully the advantages of working with data scientists, it will require auditors to develop new skills,” stated Michael Ramos, Managing Partner with MRA Learning. “They don’t need to become experts in data analysis, but they need to have a working knowledge of data analytic techniques and how data analysis can be used to answer questions and solve problems.  Auditors must become skilled at translating audit objectives into questions the data scientist can solve through data analysis.”

One respondent acknowledged, “Most companies lack the resources and knowledge to utilize all opportunities for audit improvements fully. As artificial tools become more commonplace, auditors will be able to incorporate them into their procedures.”

Of those surveyed, 15 percent view data scientists in a competitive role. Some recognized that data analytics is the future of the profession, and those who embrace technology changes will gain a competitive edge. To keep pace with evolving technologies, auditors need more knowledge and training to meet the demands of interpreting data. Data scientists using artificial intelligence and machine learning can improve business intelligence, impacting all areas of the business, not just financial.

Just 2 percent are neutral as they watch other areas of the business hiring data scientists. While it helps auditors to have someone likeminded to collaborate with and provide useful data, there is a shortage of data scientists.

Ninety-three percent of IDEA users believe the tool is helping them advance as a data analyst. Its ease of use and ability to accurately analyze data from different systems gives them an edge. From simplified data imports to “slicing and dicing” data, its capabilities are valuable when working with high volumes of data. One survey respondent noted, “It (IDEA) provides the capability of automating reports to ensure consistency of regular reporting.”

Several auditors cited the advantages of covering more information faster to identify issues, especially when working with a variety of data structures. IDEA users are embracing new enhancements, such as Python, to create more complex analysis.

“IDEA helps automate interative processes which can free up additional time for substantive analytics and data exploration.”

Overall, most see the role of data scientists and data analytics as complementary assets for all business endeavors.