KPMG — has been experimenting and deploying aspects of artificial intelligence across its business for years — is taking another step towards using AI to power its audit platform, Sebastian Stöckle, Global Head of Audit Innovation for Big 4 companies, told CFO Dive:
The company is deepening its relationship with Ottawa, Canada-based MindBridge, announcing a new partnership. end of last month It brings the technology company’s statistical, machine learning, and rules-based analytics technology into its existing digital audit platform, KPMG Clara.
News of the partnership comes as ChatGPT, an AI-driven natural language processing tool created by Microsoft-backed OpenAI, made headlines. — Critics say the hype — About the possibility of accelerating the digital transformation of your business.It is also drawn backlash arising from concern About the threats and manipulation vulnerabilities that new technology tools pose to work.
However, Stöckle said in an interview about the AI advances the Alliance is incorporating into KPMG: The audit process aims to increase audit quality and efficiency by reducing errors and possibly identifying fraud. He emphasized that people are still in control of the process. Stöckle told his CFO Dive: “It’s never a ‘leave the machine alone’ type of scenario.”
Based in Berlin, Germany stockle He has been with KPMG for approximately 17 years, during which time he has audited and advised clients on ERP systems, with a focus on audit-related data analysis. Most recently, he was responsible for developing the company’s audit analytics globally, reporting to Larry Bradley, KPMG’s Global Head of Audit. In that role, he said, he has been very focused on developing technologies such as analytics, automation, blockchain and AI.
“At KPMG, we have been experimenting, developing and deploying different levels of AI over the years for a variety of audit, tax and advisory purposes.
Generative AI models like ChatGPT currently dominate the general discussion of AI, stockle AI is actually a very broad term and has multiple levels and variants. They range from entry-level AI called From machine learning to a subset known as unsupervised machine learning, deep learning. Even the more advanced language models currently making headlines are just the “tip of the iceberg,” he said.
As for audits, KPMG has been using a base level of AI for what it calls “data preparation” for years, he said. The technology can read and extract unstructured data, such as getting invoice numbers, amounts and data from images of paper invoices, he said.
Now, with MindBridge technology, the use of AI goes one step further to not just prepare, but analyze. For example, KPMG can use next-level unsupervised machine learning to analyze anomalies and anomalous behavior in a company’s general ledger in ways never before possible.
“For example, an earnings transaction unexpectedly debits or credits an account that it doesn’t normally do, so the machine sees an unusual transaction compared to all other earnings transactions that follow a more normal pattern. identify behavior,” he said.
Therefore, the audit process will move out of the system.We use technology to randomly sample transactions and identify issues by focusing on transactions that are more likely to require attention. His CFO of the company being audited also benefits as it saves the finance team time by not having to discuss recurring issues.
“This allows us to focus our attention on transactions, an area of the audit where unexpected and anomalous behavior increases risk, allowing us to focus our clients’ time on more. Stöckle says: He added that a data-driven approach will shift some of the audit workload from the business’s finance and accounting department to his IT department.
Yet, despite all the progress, Stöckle does not foresee an era in which audits will be conducted without accountants.
“Nobody at KPMG thinks that’s happening,” says Stöckle, reiterating the importance of maintaining robust human-machine interaction at all times. “Yes, machines will take jobs, but they will allow humans to focus on areas that are really important and potentially high risk.”
