Leading in a time of technology disruption – An audit
firm perspective
The
first commercial floppy disks, developed in the late 1960s, were 8 inches
(200 mm) in diameter; they became commercially available in 1971 as a
component of IBM products and then were sold separately beginning in 1972. The
storage capacity of this disk was a mere 360Kb of data. So minute that it was
only capable of handling a few lines of text. Privileged to be entering the Y2K
period, I am grateful to having been exposed to the world of computing in year
2000 and by this time, the floppy disk was now carrying only 1.4Mb of data.
This was a bit more that what Bill Gates is famously quoted to have recommended
as he said, “640K ought to be enough for anybody.” It was
fashionable for one to be seen carrying a case full of these and in different
colours as a show of high technological appreciation. Only to imagine that
these were 10.44Mb of data, a lot of millennials would be forgiven for laughing
uncontrollably at that imagination. Fast forward to 2020 and Kingston has
released a 2Tb flash drive. Within 30 years data holding capacity has increased
a million times. An evolution that if Jimi Hendrix were to wake up from his
eternal sleep he wouldn’t believe that he can now put his entire music
collection on a flash drive which fits in his watch pocket. Such has been the
development of technology in every direction that today it continues to present
us with a threat of loss of so many jobs and people’s livelihoods. You talk of IoT,
block chain, artificial intelligence, data science, robotics to mention but a
few. These emerging technologies are reshaping the world of computing by providing
new possibilities in a world of ever increasing data.
The
accounting and audit field is one that has not been spared by this technology advancement. Research and
development teams in some of the top accounting and audit firms in Zimbabwe are
grappling with a need to stay up to date with technology while balancing that
with matching staff skills and this technology. Some of the firms have adopted
a re-skilling strategy to ensure personnel are adequately equipped to manage
these technological changes either within or external to the firm. This
strategy has seen some personnel crossing the floor from performing purely
accounting and audit functions into combining these with some of the emerging
technology driven ones like data analytics and technology risk assurance.
Though this strategy may seemingly be a viable option it has not been an easy
one for many to transition into. However, with dedication, effort and high
quality learning support from within the firm, Forbes Research shows that more
than 90% safely make it through and enjoy using this diverse combination of
skills. Those successful have also indicated that they have found themselves
being of value to their firms and clients than they were in a mono-direction
career.
To
promote the continued development and use of these emerging technologies from
quantum computing to internet of things all which generate insurmountable
amounts of data, firms in developed countries have anchored new service lines
on them. This has ensured that apart from providing a platform for continued
career development within, firms have been able to retain their best staff. In
addition, firms have managed to get a return on the technological investment by
offering these services to their clients. In that regard firms have become
innovation hubs within their spheres of influence and an anchor for supporting
client technology strategy.
But
what of the firms that are in developing nations such as Zimbabwe? Much of
these technologies have not taken root and are seemingly an expensive
investment . The author however contends that this is the time that firms
should be investing in technology, not only as way of improving their employees
but a way of expanding the revenue lines. With many still coming to terms with
the impact of Covid19 which has threatened the very existence of many companies
this is the time that firms should be rising to the occasion and shoring up
their technological capabilities. During this Covid19 driven lockdown period
research has shown that there has been extensive use of technology in many
areas such as education, work from home, robots in hospitals, drones for
deliveries, applications for information dissemination among other things. This
unprecedented use of technology has seen many companies revising and investing
in their technology transformation strategies in areas such as data analytics,
cyber security and more. Audit firms in Zimbabwe should be looking at
diversifying their lines of service to include those that have been opened up
by technology not only to retain their valuable employees but to remain
profitable in the wake of the global pandemic and thereafter. The big four
affiliated firms -PwC, Deloitte, KPMG and EY - already have access to
these world class technologies and it becomes a matter of making more research
into understanding client and matching these with such technologies.
In
addition to investing in other lines of service such as software development
and cyber security, firms can also invest immensely in data analytics. In a
recent study conducted by the Forbes magazine, it has discovered that data
science and artificial intelligence can improve audit quality. Through the use
of this technology firms can gain more knowledge and insights that reveal more about a company, its risks,
its financial reporting controls and its
operating environment. The bottom line is that these technologies will empower
and enable audit engagement teams to make key judgments and deliver
high-quality audits. These capabilities may allow auditors to test 100 percent
of a company's transactions instead of only a sample of the population. Firms
need to promote the use of technologies among its staff members to generate the
required interest in their use.
Audit
firms in Zimbabwe have the opportunity to become technology strategy drivers in
Zimbabwe, to influence and drive the implementation of the use of technology. Research
shows that employees in Zimbabwe have not been productive during this lockdown period
as a result of challenges that include;
· Prevalent use of
legacy technologies which are not capable of supporting a work from home
strategy
· Low usage of
business applications that support secure remote access.
· High cost of
internet services, and
· Lack of investment
in emerging technologies
With
its vast pool of experienced and skilled personnel both in and outside of
Zimbabwe, the audit firms have the potential of becoming the technological hub
of the nation or even Africa as a whole. There is need for someone to take a
stand and seize the current opportunity and provide leadership in building up
Africa’s own Silicon Valley in Zimbabwe. The extent to
which these advancements will shape the future of audit is yet to be determined
but the time to make inroads is now. It only takes the will and much will grow from
it. My favourite author says; “Do what you can, where you are and with what you
have”. The time for looking externally to what people can do for us is over. It
is time for audit firms in Zimbabwe to take a stand and create a technological
footprint that supports a drive towards a digital economy.
