Dr. Dawkins Brown, the executive chairman of Dawgen Global, once said, “Automation is a powerful tool, but it requires rigorous auditing to ensure accuracy.” As companies increasingly employ Robotic Process Automation (RPA) to automate their processes, auditors must adjust their methodology to effectively audit these automated processes.
When auditing processes that employ RPA, auditors need to ensure that the technology is working effectively and efficiently. Here are the steps necessary for auditing payables, receivables, bank reconciliation, and loan impairment processes that employ RPA.
Payables:
- Review the RPA process documentation: This should include the design of the process, the data inputs, the RPA workflows, and the output.
- Test the data inputs: Auditors should verify that the data inputs used by the RPA process are accurate, complete, and appropriate. This can be done by reviewing the data source documents and comparing them to the data used by the RPA process.
- Analyze the RPA workflows: Auditors should examine the RPA workflows to ensure that they are designed appropriately, that the decision points are accurate and correctly implemented, and that the process is working as intended.
- Review the output: The output of the RPA process should be compared to the expected outcome, and any discrepancies should be investigated.
Receivables:
- Review the RPA process documentation: The documentation should include the design of the process, the data inputs, the RPA workflows, and the output.
- Test the data inputs: Auditors should verify that the data inputs used by the RPA process are accurate, complete, and appropriate. This can be done by reviewing the data source documents and comparing them to the data used by the RPA process.
- Analyze the RPA workflows: Auditors should examine the RPA workflows to ensure that they are designed appropriately, that the decision points are accurate and correctly implemented, and that the process is working as intended.
- Review the output: The output of the RPA process should be compared to the expected outcome, and any discrepancies should be investigated.
Bank Reconciliation:
- Review the RPA process documentation: The documentation should include the design of the process, the data inputs, the RPA workflows, and the output.
- Test the data inputs: Auditors should verify that the data inputs used by the RPA process are accurate, complete, and appropriate. This can be done by reviewing the data source documents and comparing them to the data used by the RPA process.
- Analyze the RPA workflows: Auditors should examine the RPA workflows to ensure that they are designed appropriately, that the decision points are accurate and correctly implemented, and that the process is working as intended.
- Review the output: The output of the RPA process should be compared to the expected outcome, and any discrepancies should be investigated.
Loan Impairment:
- Review the RPA process documentation: The documentation should include the design of the process, the data inputs, the RPA workflows, and the output.
- Test the data inputs: Auditors should verify that the data inputs used by the RPA process are accurate, complete, and appropriate. This can be done by reviewing the data source documents and comparing them to the data used by the RPA process.
- Analyze the RPA workflows: Auditors should examine the RPA workflows to ensure that they are designed appropriately, that the decision points are accurate and correctly implemented, and that the process is working as intended.
- Review the output: The output of the RPA process should be compared to the expected outcome, and any discrepancies should be investigated. Additionally, auditors should verify that the RPA process is compliant with applicable accounting standards and regulatory requirements.
In conclusion, auditors need to adjust their methodology when auditing processes that employ RPA. The methodology should focus on verifying the accuracy and completeness of the data inputs, analyzing the RPA workflows, and reviewing the output. By following these steps, auditors can ensure that automated processes are working effectively and efficiently, and that the financial statements reflect accurate information. As Dr. Dawkins Brown said, “Automation is a powerful tool, but it requires rigorous auditing to ensure accuracy.”
About Dawgen Global
Dawgen Global is an international professional services firm that specializes in providing comprehensive business solutions across various industries. With a focus on accounting, taxation, auditing, business advisory, and management consulting, Dawgen Global caters to clients of all sizes, from small businesses to large multinational corporations.
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