Academic journal article Economics, Management and Financial Markets

Intelligent Strategies as a Support for Business Process Auditing - Research Directions

Academic journal article Economics, Management and Financial Markets

Intelligent Strategies as a Support for Business Process Auditing - Research Directions

Article excerpt


In this paper we investigate the most recent techniques that support the auditor in his audit activity. The review and evaluation process of internal accounting and financial control systems represents a major task to auditors and management due to the professional, legal, and economic concerns. Furthermore, there are other many reasons for the auditor to be able to effectively review and evaluate internal accounting and financial control systems; among them the economic reason becomes dominant. However, the competition within the auditing industry becomes tighter, and maintaining competitive auditing costs is crucial for any auditing company to survive. The auditing costs could be drastically reduced by using in auditing process the most advanced intelligent tools, adapting them to the internal accounting control systems, and by decreasing the scope of essential tests. Concluding, we tried to show in this research paper that the availability of process mining techniques, Fuzzy Logic modeling intelligent strategies combined with the well-known Unified Model Language (UML) diagrams, Petri nets modeling tools and the omnipresence of recorded business events will dramatically change the role of auditors.

JEL classification: C88, M42

Keywords: Audit process, Accounting control systems, Agent based modeling strategy, Process mining techniques, Colored Petri Nets models, Intrusion detection systems (IDS), Software Fault Tree Analysis (SFT), Computational Intelligence (CI)


The definition of internal control has gone through several revisions by various authoritative institutions. AICPA defines internal accounting control as the accounting control that comprises the plan of organization and the procedures and records that are concerned with the safeguarding of assets and the reliability of financial records1. This definition identifies the goals of internal accounting control and the general types of practices included in an accounting system for achieving these goals. As indicated by this definition, the main goals of internal accounting controls include:

(i) Safeguarding of assets against loss arising from unintentional or intentional errors in processing transactions and handling the related assets,

(ii) Maintaining the reliability of financial records for external reporting purposes.

In addition, the definition specifies that a satisfactory internal accounting control system should include:

(i) A plan of organization which provides appropriate segregation of functional responsibilities,

(ii) A system of authorization and record procedures adequate to provide reasonable accounting control over assets, liabilities, revenues, and expenses. However, an internal control system might incorporate elements beyond the accounting and financial activities to which many accountants think internal control are limited. Such elements include: "budgetary control, standard costs, periodic operating reports, statistical analyses and the dissemination thereof, a training program designed to aid personnel in meeting their responsibilities and an internal audit staff that provide additional assurance to management as to the adequacy of its outlined procedures and the extent to which they are being effectively carried out. It properly comprehends activities in other fields as, for example, time and motion studies which are of an engineering nature, and use of quality controls through a system of inspection which fundamentally is a production" [AIA, 1949]. These non-accounting control devices are termed administrative control or management control.

More specifically the term auditing refers to the evaluation of organizations and their economics and business processes2. The purpose of the audit activities is to ascertain the validity and reliability of information about these organizations and theirs associated processes. During these activities the auditors perform different sequential tasks to check whether business processes are executed within certain boundaries set by managers, governments, and other stakeholders2. …

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