Common Uses of Data Analytics by Internal Audit & Benefits of Using It
Most commonly, auditors use data analytics for fieldwork and engagement planning, and use the results to identify anomalies and test controls. For many functions data analytics is used in more financially oriented audits such as: General ledger; Purchase to pay; Payroll; Travel and subsistence/entertainment; and order to cash (a set of business processes that involve receiving and fulfilling customer requests for goods or services).
Perform supplier audits by utilizing line-item billing data to identify anomalies and trends to investigate. Identify poor data quality and integrity around various data systems that are key drivers to non-compliance risks. Identify areas at high risk of fraud and assess controls. Isolate key metrics around spend analysis e.g., payment timing, forgone early-payment discounts and payment efficiency. Perform duplicate payment analysis and recovery.
Credit: Data analytics – is it time to take the first step? by Chartered Institute of Internal Auditors (April 2017)
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