5 minute read 10 Oct 2019
Simplification and innovation - Conceptual illustration

Why simplification and innovation in the audit go hand in hand

The EY Digital Global Audit Methodology leverages the power of data to simplify audit tasks, while emerging technologies support innovation.

Auditing is – and has always been – a complex profession. As the processes and systems organizations use continue to transform in the digital age, new professional standards are emerging. In parallel, regulatory oversight is also expanding.

As part of the EY commitment to quality, the audit is evolving to respond to this complexity by increasing the digitization, centralization and standardization of audit processes, enabling EY auditors to gain better information and insights.

In the EY Digital Audit, simplification and innovation – which together form one of the pillars of the Sustainable Audit Quality program – go hand in hand, with one leading to the other as more effective ways of working are developed. Bigger and better data are combined with innovative ideas, resulting in simplified processes and an opportunity to examine work through a more purposeful lens. This enables a stronger focus on risk and, in return, an increase in audit quality.

Data at the heart of the audit

Beginning in 2020, the Global Audit Methodology (GAM) that EY auditors use to interpret and apply international and domestic auditing standards will be transformed with a new approach that puts data at the heart of the audit.

Known as Digital GAM, the new methodology facilitates the analysis of full populations of an organization’s data to produce a more complete picture of the business. It enhances (and often replaces) the traditional audit testing approach with new, risk-based, technology-enabled techniques that simplify and refine the auditor’s focus on identification of and response to relevant risk.

Digital GAM analyzes full populations of an organization’s data to produce a more complete picture of the business.

Digital GAM focuses on simplifying tasks and improving linkage from one audit procedure to the next. Powered by EY Digital Audit technology, automated techniques are embedded in phases of the audit, analyzing information across an organization’s “business cycle,” or the flow of financial activity that results as an entity operates its business. The correlations and relationships between different sets of data throughout the business cycle demonstrate how the organization has recorded the transactions and help EY auditors better identify areas of risk and how to respond to those risks.

Digital GAM requires a change in mindset and approach from EY auditors. Some changes are tactical, such as new audit tasks, refocused approaches to journal entry testing and the online availability of standard audit forms, templates and checklists. Other changes, however, are more strategic and require a deeper change in behavior and overall approach, such as enhanced mentorship, which will enhance quality and professional skepticism.

Emerging technologies

Another area where simplification and innovation are working in tandem to enhance audit quality is emerging technologies. In this dynamic working world, companies are harnessing a range of such technologies in their efforts to adapt and grow.

It is the same for EY. Stakeholders expect auditors to deploy the latest technology to better understand businesses and the risks they face. That’s why EY teams are leveraging emerging technologies as part of the connected, data-driven audit.

For example, artificial intelligence (AI) is an increasingly important tool in the delivery of a high-quality audit. A range of tools has been developed that use AI, such as Document Intelligence for Contract Review, which enables audit teams to review business documents more effectively by leveraging machine learning technologies.

The benefits include improved speed and accuracy of reading and interpreting contracts. It is estimated that the time taken to review documents is decreased by 60%-80%, allowing audit teams to focus on judgments, higher-value activities and relationships with key stakeholders.

As a profession, auditors must keep questioning, analyzing and evaluating data from every perspective.

Another new technology making an impact is blockchain. The EY Blockchain Analyzer is a suite of blockchain audit technologies that enhances the ability to perform an in-depth review of cryptocurrency (and digital assets at large) business transactions. The technology supports EY teams as they perform audits for companies using a range of cryptocurrencies.

In April 2019, the second generation of the EY Blockchain Analyzer was announced. This included developments that supported new cryptocurrencies on the platform and added functionality relevant to private and public blockchains. The Analyzer can now be used for multiple purposes such as audit, tax and transaction monitoring.

Asking the right questions

By combining the different forces impacting finance and audit, as well as the opportunities offered by disruptive technologies, EY teams are making the audit process more effective throughout each stage. The appropriate use of these new tools will enable the delivery of high-quality audits and streamline information exchange with the organizations audited at every stage of the process.

The EY Digital Audit has been vital in harnessing these disruptive technologies. As a profession, auditors must keep questioning, analyzing and evaluating data from every perspective. Automation may relieve auditors of many time-consuming administrative or repetitive tasks, but trust in the digital age is still developed through human decisions, and the responsibility to ask the right questions remains unchanged.


The EY Digital Global Audit Methodology – which will be rolled out worldwide in 2020 – helps to simplify and standardize the approach used by EY auditors, while improving the quality, consistency and efficiency of the audit. Growing use of innovative technologies such as AI and blockchain also helps auditors to better understand businesses and the risks they face, including an increased understanding and focus on judgments

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