Auditing always holds the biggest challenge in it, such as data privacy, Data Governance, Ethics, and Integrity. Earlier data was something that is human-generated and structured by them. Whereas, recent technological inventions have turned data to be machine-generated and unstructured. Thus, the massive cluster of data is now termed to be the Big Data. This big data is expected to have a drastic impact on productivity, profits, and risk management. Analytics, a process of verifying the data and its objectives, which draws a meaningful conclusion.
Very few companies have understood the importance of both Big Data and Analytics. They have also started investing in the same to understand the effects of these techniques in their businesses.
In today’s post, let us discuss the same and how it could impact the considerable auditing industry.
Let’s get started!!!
What Is Big Data, And Why Is It Important?
Big data is considered as the ability to take advantage of the information in unique ways to reflect useful insights or goods or even services of significant value.
The Big Data deals with the most critical three V’s which are,
Volume: The amount of data gathered. There are around 2.5 trillion gigabytes of new data being created.
Velocity: The speed at which it processes the data regardless of the size.
Variety: Types of data are structured as well as unstructured.
Big data is a combination of the foundations mentioned above. The Big Data platforms provide tools, methods, and technologies that are helpful to capture, curate, stock, quest, and examine data to find new associations, relationships, and trends that are unavailable.
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You can also see the Business Intelligence trends and it also suggests a bright future for the Big Data in the audit department as well.
Initially, Big Data was meant to address either the structured or unstructured data, at recent times significant content of information and content repositories of huge companies utilize the big data to share and store more information along with:
- Email and messaging
- Summing up Intranets and Extranets
- Public websites
- Social media channels
- Data from industrial sensors and monitoring devices
How Helpful Is Big Data?
Big Data in recent times are considered “more important” for around 93% of companies over $250M. A big data at recent times acts as a “cloud” and helps to store as well as manage vast amounts of data.
Utilizing big data can help you unlock the diplomatic value of the information by allowing you to:
- Secure client base with better loyalty programs
- Avoid cross-selling and upselling opportunities
- Optimize workforce planning and operations
- Exploring a new source of revenue
- Improve inefficiencies in the supply chain
- Discover market trends and future needs
What Is Big Data Analytics?
The next question that strikes you by this time would be, “What is Big Data Analytics?” Big Data Analytics allows you to examine large amounts of data that lets you uncover hidden patterns, correlations, and other insights.
Our current technological trends allow you to analyze data and render a solution in a better way than the estimated time. Thus, this became an effort that turned out to be more efficient with more business intelligence solutions.
Big data analytics helps organizations to exploit more data and use it to explore new opportunities. This indeed leads to smarter business moves, effective operations, and better profits.
The Big Data Analytics helped leading organizations to get value through the following ways,
- Cost reduction
- Faster and Better decision making
- Innovative products and services
In recent times, most companies and organizations make use of big data analytics. Whereas, a few companies are capable of understanding and harnessing the big data and its value.
So how does big data analytics help in transforming the audit industry? Let us see in detail.
How Does Big Data Analytics Help In Transforming Audit?
As we are put up in the toughest and critical situation of modern economics, the role of financial marketers has turned out to be the most important aspect.
Auditing companies need to continue their robust audits to provide insightful, valuable, and increased quality financial statements to their users.
Therefore, the implementation of big data and analytics in auditing has brought in new opportunities that help to rethink the way in which the audit is executed.
The restructured auditing process will now expand wider than the sample-based testing, which involved the analysis of the entire population of audit-relevant data using intelligent analytics, which delivers a higher quality of audit results and even better business insights.
The involvement of the technology in the auditing industry is still in its childhood stage and yet to undergo various other stages of its maturity.
So far, the audit analytics are processed using large client data sets within a closed environment; this has to be transformed into an approach where companies get it comfortable for future audit processes.
The transition of this technology cannot be expected within 24 hours. It takes a considerable leap to switch from the traditional auditing approach to the one that fully consistently incorporates big data and analytics.
The auditing that is happening now will never be the same in the future.
Auditors of the future might involve a larger data set along with analytics to get a better insight into the business and the critical risk areas of the business.
This indeed results in higher business value.
But to achieve such a huge transformation, the entire industry has to work close to the key stakeholders of the business they are auditing.