V1I4P2

Embracing Proactive Auditing post Covid-19: Are auditors ready? 

Muriel T Takachicha^1*, Farirepi Mugozhi¹, Lilian Nyamwanza ¹, Linda M Mabwe¹, Rumbidzai Chipindu¹

Abstract

This research sought to analyse the Impact of Proactive auditing using digital technologies in audit practices. The aim was to develop an informed understanding of the benefits and challenges which may arise from using a proactive rather than reactive approach to seek out risk. Advances in technology have caused a paradigm shift from reactive to proactive auditing. According to Caska and Searcy (2021), the Covid-19 pandemic exposed the obsolescence and vulnerability of many existing auditing practices. A statement from Tuanakotta (2012) highlighted that proactive audits are one way to prevent and detect fraud in accounting. Therefore legitimacy of audits now depends on the audit profession’s ability to master new technologies and evolve audit practices, programs, and offers. A new paradigm is needed to not only account for possible future lockdowns but align practices with the level of digitalisation and automation. This research utilized a qualitative research design. Perceptions of 15 audit managers were gathered through in-depth semi-structured interviews. Findings included benefits and challenges associated with proactive auditing. The challenge faced at the organisational level is the investment required for the new technological possibilities both from an auditor and client perspective. Though the pandemic has changed communication and relationships between auditors and clients, few are ready for another pandemic. Recommendations drawn include bridging the divide in terms of resource capacitation in training and skills development so that auditors and clients gain on the increased use of digital communication and also use it as a complement to physical meetings in the future.

Keywords:

Proactive auditing; Reactive auditing; Covid-19; Digital technologies; Remote auditing