Usage of technology in audit: A case study with a large Audit Firm1
Miklos A. Vasarhelyi
Rutgers the State University of New Jersey
Montclair State University
Usage of technology in audit: A case study with a large Audit Firm
Accounting information systems are ubiquitous in today’s business, supporting most of its operational functions. Since their review and assessment is necessary and appropriate software tools are now available, this paper asks: Do auditors use the available technological tools? What are the difficulties they find? Are there mediators to facilitate usability? Through a cross sectional case-based field study comparing four engagements in a major audit firm, this paper finds that the characteristics of the audit team determine the levels of technology adoption. However, quality integration between technology support teams and auditors may improve usability and consequently increase technology adoption. Keywords: audit tools, audit technology, usability audit
The potential of technological tools, and the progressive digitization of business, has changed the way external audits are conducted. The increasing ubiquity of accounting information systems has made it necessary enhance the auditor’s toolset and to include specialized teams to evaluate those systems throughout the external audit. Dowling , looks at factors that determine the appropriate usage of technological tools; and Dowling and Leech  compare the audit support systems used in five big audit firms. In this paper, on the other hand, we focus on tool usage and their conditionants. We also discuss what are the difficulties found in system implementation and tools to facilitate usability. These questions are investigated through a cross sectional case-based field study comparing four audit engagements. The following section reviews the literature, the ensuing section discusses the methodology, and the final two sections address findings and conclusions. Conditions that favor usage of technology
In this section we examine the determinants of technology usage. Then, by conducting interviews with audit teams, we inquire why available technological tools are not used. Further analysis leads to suggestions concerning tools to improve the levels of usage. Manager’s attitudes, beliefs and social environment
“Many times users do not rely on decision aids even when doing so would improve the quality of the decision” . For any technological tool to be adopted in an audit engagement, the audit manager must believe that its use will provide some advantage. However, auditors are often overconfident in their judgments and believe that they do not need the tool, and will adopt it only if it confirms their judgment . Different studies have examined the determinants of information technology usage. Karahanna et al.  present the following key constructs in the innovation-decision process: 1. Innovation’s perceived attributes,
2. Individual’s attitude and beliefs, and
3. Communications received by the individual from his/her social environment about the innovation (subjective norm). These norms are determined by the individual’s beliefs about what their peers expect from them. Therefore, when audit managers do not have the required knowledge about a new tool and/or do not perceive its benefits, the tool will only be adopted if there is substantive pressure by peers or supervisors. Dowling  surveys 569 auditors of large and medium sized audit firms, and finds evidence that intention to use a system increases the appropriate use. She also finds that perceived normative pressure and auditor’s attitude influence appropriate auditor’s system usage. However, lack of knowledge about the tool might convince the auditor that s/he should rely on other evidence .
Arnold and Sutton  express concerns that the continued use of an intelligent...
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