The event of the global financial crisis is a stack reminder of the importance of audit quality. As various stakeholders grapple with the series of business failures and corporate scandals, the need to re-examine the veracity of audit reports as well as the quality of these audit reports has taking a center stage. Today’s business landscape is increasingly seeing the emergence of new digital technologies like analytics, big data, cloud, social media, mobile etc. Such digital technologies are reshaping existing products, creating new products and services as well as turning digital resources within organizations into a new revenue streams.
These digital technologies are creating new audit landscape requiring auditors to alter audit processes, controls and tests. Navigating through the plethora of cross-functional technologies in a vastly digital world is requiring a new breed of auditors. For instance, cloud computing platforms allow enterprises to run business processes through a network connection while eliminating the conventional IT hardware and software infrastructure that supports these business processes.
Auditing in a cloud based enterprise presents various unconventional audit-related risks that may impact on the internal control system and overall audit quality. Risk-based assessment for firms using cloud computing platforms is convoluted because the technology infrastructure and control mechanisms are house and managed outside the enterprise being audited. Cloud computing adds additional layers into the audit procedures as auditors may have to examine the cloud service provider, data center and in some cases third party vendors to establish inherent risk and potential control risk.