Intelligent Process Automation in Audit Abigail Zhang Continuous

Intelligent Process Automation in Audit Abigail Zhang Continuous Auditing & Reporting Lab Rutgers Business School 43 rd WCARS 11/03/18 1

Overview • Introduction • “Auditor-in-the-loop” IPA ecosystem • Audit workflow driven by IPA • Implementation framework • Ongoing and future research 2

Introduction Audit workflow/process Initial state Task 1 a Task 2 a Task 3 a Activities Task 1 b Task 2 b Task 3 b Activities Task 1 c Task 2 c Task 3 c Activities … … … Process Automation RPA PPA IPA … … … Pre-defined Process Automation (PPA): the patterns of the process are pre-defined by human. Robotic Process Automation (RPA): run application software in the same way that a person works with that software. Intelligent Process Automation (IPA): the patterns of the process can be learned and predicted by AI, and then recommended to human. Objective: Establish a framework and build a prototype of IPA in audit, and evaluate their efficiency of effectiveness. 3

IPA Ecosystem in Audit IPA Ecosystem RPA Artificial intelligence Machine learning Computer vision Virtual agent NLP/ NLG Others Cognitive computing Other technologies Data analytics Drones Smart Blockchain contracts Io. T Others 4

The “Auditor-in-the-Loop” IPA Ecosystem 5

The Audit Workflow Driven by IPA Smart workflow 6

Framework of Implementing IPA in Audit 1. Process understanding 2. Process redesign 3. Process modularization 6. IPA prototype testing and modification 5. Process orchestration 4. Process automation • • PPA/RPA Algorithm training and testing 7

Potential Application of IPA in Audit-Inventory testing AI and Human cognitive technologies Think Drones, NLP, Io. T, etc. PPA/RPA Feel Do 8

Ongoing and Future Research • Ongoing research – RPA component of the IPA ecosystem • Prototypes in audits • Impacts on audits • Future (not too far) research – IPA in audits • Prototypes in audits • Impacts 9

“If we knew what it was we were doing, it would not be called research, would it? ” -Albert Einstein Thank you! 10