John Colthart

Recent advancements in Artificial Intelligence (AI) and machine learning are ushering in a new era of possibility for the audit function globally. By touching all transactions in a data set, audit firms around the world are using this cutting-edge technology to drive tremendous efficiency and effectiveness gains.

Gilbert Associates Inc. recently adopted MindBridge Ai Auditor™, which utilizes a hybrid of tests including machine learning based algorithms, rules-based tests, and statistical models, against each transaction in the complete financial dataset. Through the analysis of all the records, the results are presented to the user in an intuitive, visual interface which augments the capabilities of audit and investigative professionals by allowing them to focus their analysis on the most relevant activities. Our VP of Growth, John Colthart had a conversation with David Ljung, CPA, President and CEO, Gilbert Associates Inc. and Kevin Wong, CPA, Director of Audit Practice about how integrating AI technology into their audit practice is creating value for their clients.

Here’s what they had to say!

John Colthart: Tell us about Gilbert Associates Inc.

David: Our clients are a mix of closely-held companies, nonprofit organizations, and governmental agencies. Our emphasis is on delivering high-touch customer service and adding significant value to their organization.

John Colthart: What do you see as your biggest opportunity?

David: Our biggest opportunity lies in our ability to capitalize on technology to improve the efficiency of our work and produce greater insight into our clients’ organizations to increase both their effectiveness and profitability.

John Colthart: What do you see as the biggest threat or challenge?

David: Being unaware of or ineffectively utilizing current technology to improve our service to clients.

John Colthart: How do you plan to address it?

David: We plan to approach technological advances openly, and challenge ourselves to push the envelope to identify those which can effectively improve and expand services to clients while maintaining an appropriate balance with our costs of delivering those services.

John Colthart: What made you choose MindBridge Ai Auditor™? What are the features that you plan to use?

Kevin: MindBridge Ai Auditor™ gives us a scalable opportunity to tap into Artificial Intelligence(AI) technology without the up-front software and data science development costs. As the first product of this kind in the market, we hope to leverage Ai Auditor™ to make our audits more efficient, reduce audit risk, and as a differentiator in the industries we practice in. Beyond the risk analysis of 100% of general ledger transactions, we are in the exploratory stages of determining how we can most effectively incorporate this technology into our processes, provide deeper value-added insight into our clients’ operations, and open new service lines.

Today’s audit environment is more dynamic, complex and growing than ever before concerning financial data.  The challenges with globalization, the growing Internet, Big Data and ERP systems with multiple touch points fuels the growth of financial data and challenges the ability of professional accounting firms to assert high-levels of confidence in performing audits.

However, with the recent advancements in technologies such as artificial intelligence (AI), auditors can augment their capabilities to sift through and analyze these large amounts of data.

At MindBridge™ Ai, we utilize a hybrid of tests including machine learning based algorithms, rules-based tests, and statistical models,  against each transaction in the complete financial dataset. Through the analysis of 100% of the records, the results are presented to the user in an intuitive, visual interface which augments the capabilities of audit and investigative professionals by allowing them to focus their analysis on the most relevant activities.  MindBridge Ai has elevated the definition of ‘reasonable assurance’ to help auditors ensure financial data is free of errors, and potentially intentional misstatement. Accounting and auditing firms across the world are acknowledging the value of AI and are using it as a competitive advantage.

One such forward-looking firm is KNAV P.A., a KNAV International Limited firm that has recently adopted MindBridge AI Auditor™. KNAV International Limited is a not-for-profit, non-practicing, non-trading corporation incorporated in Georgia, USA, and it has more than 400 professionals and 42 partners in nine locations across the world. I recently sat with Atul Deshmukh, Global Leader of Assurance Services, at KNAV to learn how he plans to transform the auditing business with the use of AI.

Let’s meet Atul!

John Colthart: Tell us about KNAV.

Atul:  KNAV International Limited is an association of global accounting and consulting firms, founded in 1999, that offer a complete suite of public accounting services—including set-up, accounting, assurance, taxation, international transfer pricing, risk advisory and business advisory services—and facilitate seamless business growth through mergers and acquisitions.

Today, KNAV is an international organization comprised of more than 400 professionals and 42 partners in nine locations (India, the United States, Canada, Switzerland, Singapore, France, the Netherlands, the United Arab Emirates and the United Kingdom).

Working with some of the largest and most recognized multinational companies, KNAV enables clients to comply with financial reporting, regulations, and taxation across multiple geographies. KNAV P.A., our US public accounting firm, is headquartered in Atlanta, Georgia and is the US founding member firm of KNAV International Limited. KNAV P.A. is also a member of Allinial Global, an association of independent accounting firms within North America and the rest of the world. The resources of Allinial Global are comparable to those of a “Big Four” firm. Allinial Global firms share ideas, training resources, best practices and, most importantly, knowledge as needed to meet the needs of their clients anywhere in the world. Although member firms are owned and managed independently, there is substantial collaboration among the members, allowing member firms to better serve clients in a wide range of industries.

John Colthart: What do you see as your biggest opportunity?

Atul:  At KNAV P.A., we foresee a tremendous growth in investments by multinational companies, specifically companies from India or in North America and companies that thrive on the Indo-US business model. Our presence in Atlanta and the Bay Area in the US and across various cities in India and our ability to provide audit, tax and advisory services in the US and India to these multinational companies are our biggest opportunities. We have a leadership position in this niche market, and we expect to continue to grow in this market segment.

John Colthart: What do you see as the biggest threat or challenge?

Atul:  The need to keep abreast of changing accounting and reporting standards, the complexity of conducting audits of large public multinational companies and the challenges of ever-changing tax laws continue to be our biggest threats and challenges. Coupled with the increasing complexity within our service delivery, the dearth of skilled and trained resources within our niche segment creates a high-risk environment for our firm. The huge investments that larger accounting firms are making in technology will effectively level the price differentiation between these firms and smaller firms such as ours. Losing our coveted space in our market segment to larger firms is a threat that is real and imminent.

John Colthart: How do you plan to address it?

Atul:  KNAV has established a special task force to keep the firm abreast of the latest developments in accounting, auditing and taxation. We are heavily investing and relying on technology to mitigate the risk arising from the deficiency of skilled and trained professionals in the marketplace. We continuously seek ways to get a first-mover advantage by embracing state-of-the-art tools and techniques that enhance the accuracy and efficiency of our services. In this context, the use of AI for data mining and analytics is a strong step that we have taken to dramatically improve and enhance the efficiency of our professional audit staff.

John Colthart: What made you choose MindBridge Ai Auditor™? What are the features that you plan to use?

Atul:  We at KNAV felt that a unique solution such as MindBridge AI Auditor™ would allow us to provide a more time-efficient, more economical, more rigorous and higher quality audit, which provides an elevated level of assurance to our clients. Since our focus is on having stronger analytical, data science and IT skills to complement our financial and cross-border business acumen, we were clear that this tool would help us tremendously in making our audit process faster, more reliable and more efficient. In today’s digital world, it is critical for the audit profession to embrace advanced technology tools—including robotics, automation, and cognitive technology.

The smart data import, out-of-the-box integration with leading ERP and accounting software, features related to risk-based scoring, user-interface design and transaction sampling are the key features of the MindBridge AI Auditor™ that would enable the KNAV team to work closely with the client. The fact that we are exposing each and every transaction from the client general ledger to 26 rigorous tests is a game changer. Never before have we been able to conduct such an in-depth analysis of client data at the transaction level.

To see an announcement of our relationship with the KNAV P.A., please click here.

Compared to humans, new technologies like Artificial Intelligence (AI) are ideal for automating mundane tasks related to auditing. AI can also verify every transaction and codify human knowledge, enabling auditors to review, analyze and audit more effectively. As big firms adopt AI in their auditing processes, smaller firms are also realizing the value and becoming frontrunners for this positive change in the industry.

Garbelman Winslow CPAs (“Garbelman Winslow”) is a full-service public accounting firm servicing businesses and non-profit organizations for over seventy years throughout the Washington, D.C. metropolitan area, has adopted the MindBridge Ai Auditor™. As part of our Customer Spotlight series, I had the chance to catch up with Samantha Bowling, CPA, CGMA, Partner at Garbelman Winslow. Samantha has been with the firm for over 25 years and has been involved with auditing services since her career started. She has utilized technology to enhance the audit process from paper to paperless and is now implementing AI to assist in risk assessment, audit assurance, and effectiveness.

Let’s meet Samantha!

John Colthart: Tell us about Garbelman Winslow.

Samantha:  We are a small public accounting firm located in Prince Georges County, Maryland.  Our firm has been in existence for seventy years. We provide various services to our clients: Audit, Review, Compilation, Tax, Bookkeeping, Payroll, CFO, Information Technology, Financial Planning and Consulting Services. Our clients include non-profit organizations, construction contractors, manufacturers, professional services, wholesalers, and distributors.  We have utilized technology since our formation starting with a mainframe computer and punch cards to desktops and tablets.  We provide services to other public accounting firms who do not invest in technology so that they can meet their customers’ needs.  We are involved in the accounting profession so that we can make it better for everyone.  We are not afraid of change and embrace technology to enhance efficiency for our office and for our clients.

John Colthart: What do you see as your biggest opportunity?

Samantha: The biggest opportunity I see is to be a part of the development of AI technology to make sure it really does enhance audit efficiency, reduce risk and produce a better audit.  I believe our feedback during this implementation will help make AI relevant and demonstrate to other small firms that AI is available to them.

John Colthart: What do you see as the biggest threat or challenge?

Samantha: The threat is not embracing AI. I feel other small firms will not embrace the technology and they will no longer perform audits.  Auditing services will move to larger firms. In today’s rapidly changing technology environment more and more “CPA” functions are being automated. If CPA’s at small firms stop performing audits, then they will have to redefine their services and relevance.

John Colthart: How do you plan to address it?

Samantha: Implementing MindBridge Ai Auditor™, providing feedback and making sure it works the way we need it to be the first step. Also, exploring additional uses; I believe this is a valuable management tool for outsourced CFO services as well as an oversight tool for all businesses looking to identify risk within their financial transactions. Ultimately using this platform to demonstrate the importance of AI supported services and explaining how it works to all Maryland CPAs.

John Colthart: What made you choose MindBridge Ai Auditor™? What are the features that you plan to use?

Samantha: I was looking for an affordable AI platform.  I used my “Google” machine and this was the only application that I thought would work for my small firm.  We plan to use all features in our implementation phase to assess which may be valuable to each of our clients, not just our audit clients.

To see an announcement of our relationship with Garbelman Winslow, please click here.