Accounting Eras 5.0 - PDF

Accounting Eras 5.
0
Dr. Jack Huang
Chair, ICAEA International, Canada
| The World’s Best Auditor Copyright © 2022 ICAEA.
About Me Summary
• Chair, ICAEA International, Canada
• Director, Taiwan- India Joint Research Center on Artificial
Intelligent, MOST, Taiwan/India
• Director, Center for e-Manufacturing and e-Commerce,
National Chung Cheng University, Taiwan
• Fellow, British Computer Society, UK
• CPA, CPA Australia
• Director, PwC Education Foundation, Taiwan
• Supervisor, SME Credit Guarantee Fund of Taiwan
Dr. Shi-Ming (Jack) Huang
FBCS, CPA Australia,ACDA,
CEAP, PADI Advanced Diver Experience
• Chairman, International Chinese Information System
Association, USA
• Zipf’s Law Fraud Detection Mechanism Inventor
2
Taiwan- India Joint Research Center on Artificial

Intelligent , IIT Ropar, India
Research Center Opening

IMAGINING
AUDITOR’S
FUTURE
Photo Source: https://www.theguardian.com 55

Where is Auditors' Future Job?
Accountants and auditors 0.94
Published by the Oxford Martin Programme on

Technology and Employment, 2013 Source: 2014 The Economist 6
Auditor Robots
You’re either the one creating automation
… or you’re the one being automated.
A recent Oxford University study examined how automation and robotics are affecting different professions.
Among the over 600 professions considered, auditing was right at the top—deemed by researchers as a profession
ripe for automation, with a 96% chance of being largely replaced by computers in the next two to three decades.
Data Source: 2017 ACL 7

Capturing Opportunity
8
Accounting Education Shift

Accounting Accreditation Standard A7 White Paper
AACSB（The Association to Advance
Collegiate Schools of Business）:
to create the next generation of great
leaders. AACSB provides internationally
recognized, specialized accreditation for
business and accounting programs at the
bachelor's, master's, and doctoral level.
Standard A7 is a new standard for

Accounting Program: (Information
Technology Skills And Knowledge for
Accounting Graduates):
data sharing, data analytics, data
mining, data reporting and storage
within and across organizations 9
AICPA CPA Exam changes 2021
Data Analytics +
Digital Mindset
Source: AICPA, 2019

10
ICAEA Mission
The purposes of the society are:

• to give the potential computer auditors an overview of the main activities of computer
audit and the role of computer auditor;
• to assist the potential computer auditors to become a successful computer auditor;
• to define the competency of a computer auditor;
• to define the learning map of a computer auditor;
• to evaluate the professional quality of a computer auditor.
11
Computer Auditing: The Way Forward

Computer Auditing: The Way Forward
1) Adoption
2) Solutions
3) Audit quality
4) Robotic process automation, artificial
intelligence, and emerging issues
5) Teaching materials or instructor training
materials
Wang, T. and Huang, S., 2019, Computer Auditing: The Way Forward,
International Journal of Computer Auditing , Vol.1, No.1, pp.1- 3.
12
CAATs Paradox for Auditors

Although many auditors
have a high satisfaction of
CAATs for its benefits of
their work, CAATs are
still not widely used by
internal auditors or
external auditors.
(Bierstaker, Janvrin, &
Lowe, 2014; Curtis &
Payne, 2014)
Source: Quora
It is a good skill, but I do not know how to learn……….

13
Auditor’s Competency to Audit Performance

Wu, Huang, et.al.,2016, Information
Systems Frontier Journal
Knowledge Audit
Performance
Self-Efficacy Theory (SET)

14
Efficacy of Teaching
Source: prezi.com 15
2019 Data Analytic Case Competition

Chicago, USA 2019/04/07
16
2019 Data Analytic Case Competition

Chicago, USA 2019/04/07
17
CPA's Technology Mindset & Data Analytic Skill
Clients’ IT
Environment
and Control
CPA’s
Technology
Audit
Mindset 0.553***
& Data Analytic Quality
Skill
CPA Firms’ IT
Environment
& Control
Source: Lu, 2020

18
Current Status of CAATs from IIA
19
2022 Computer Auditing Survey

CAATs History
• ACL - 1987
Dr. Hart Will
CPA
ACL’s founder
• IDEA - 1989
Dr. Jack Huang, ICAEA
Mr. Dwight Wainman Bob Cuthbertson, CaseWare
CPA Hart Will, ACL
CaseWare’s founder Georg Herde, DIT
Taiwei Wang, DePaul University
ICAEA 2015, Vancouver, Canada 21
CAATs Trend
Picalo
Diligent Ltd. CaseWare Ltd. Picalo -

data analysis Smart Auditing
+ AI Detectlets
22
The Fastest Digital Transform Era
Source: McKinsey, 2020 23

Technology-related Capability
Source: McKinsey, 2020 24

Audit Data Analytic after COVID-19
An
Enterprise
New Audit Data Analytic =

Data Analytic + Text Analytic + Machine Learning
Source: ICAEA 2021
25
26
2022 ICCP Competency Framework

Knowledge
• Technology Mindset
• Computer Assisted Audit Techniques (CAATs)
• Advanced Technology: Text Analytic and Machine Learning
Skill Attitude
• Using CAATs Skill • Legal/Guidance Issues for Computer
• Hands-on Practice Case Study Auditors
• Ethical Issues for Computer Auditors
27
ICCP Exam Review

ICAEA 2023 in Chicago, USA
Date: 2023.04.28
29
HOW TO PUBLISH A PAPER?
30
Chief Editor or Associate Editor Journals
SSCI/SCI Scopus List Journal DOAJ List Journal EBSCO List Journal
31
Academic Life
Publish
or
Perish
32
Publish Game Play by Four Parties
Author Editor
Publisher Reviewer
Impact Factors Database (WOS, Scopus, EBSCO, ….)
33
Author View Point:
 very low acceptance rates;

 too much time spent on the reviewing process;
 too much focus on the technical quality of a
manuscript rather than its inherent contribution to
the academic discipline.
34
Become a Reviewer
Some SSCI top quality journals his implies a rejection rate of 90%.
Too many
reviewers are
Too many authors
setting
are submitting
unrealistically high
substandard
hurdles over which
articles.
authors have to
jump.
35
What was the good of doing research in accounting?
If you imagined that accounting was the oil of

British industry, then the role of the academic
researcher was to improve the quality of the oil.
--Professor Eddie Stamp of Lancaster University
Accounting research has as its objective the production of

something of value to society.
36
Write a Paper
Innovation Practice
Research
Framework/ Research Method
Architecture/
Model
10% accept rate  Imply 10 papers submitting
37
AAA Journals
https://aaahq.org/Research/Journals 38
Objective of Journal
Accounting Review
‘‘The Accounting Review should be viewed as the premier journal for publishing
articles reporting the results of accounting research and explaining and illustrating
related research methodology. The scope of acceptable articles should embrace any
research methodology and any accounting-related subject, as long as the articles
meet the standards established for publication in the journal... The primary, but
not exclusive, audience should be...academicians, graduate students and others
interested in accounting research.”
Auditing: a Journal of Practice and Theory

‘‘The purpose of this journal is to contribute to the theory and practice of auditing.”
https://aaahq.org/Research/Journals 39
7 1st International Conference of the Journal of Information Systems
https://www.ec.ccu.edu.tw/2020.JISC
• September 30, 2020: Research papers due. Early
submission encouraged.
• December 31, 2020: Author notification.
• March 25-26, 2021: International Conference of the JIS,
National Chung Cheng University, Taiwan.
40
Father of Modern Accounting

SCI vs SSCI
Source: Dr. Meena Sharma, 2018

41
Regtech and Computer Auditing:
The way forward
42
1
Why you need an auditor?
1 Control vs Fine Tickets

1 Fine Game – A New Economy Risk Value Chain

Quanta Storage ordered to surrender nearly all assets to HP
45
1 How about HP?
46
1 The annual number of companies to resolve FCPA cases
47
1 The top 10 cases of FCPA enforcement action (2009-2017).

SIEMENS ALSTOM VimpelCom
BAE (Germany) (France) (Holland) Alcoa
(UK)
(US)
$579 $519 $965million $412 $398
$400 $772 $795million $384

$800million
Teva Pharmaceutical Och-Ziff Total SA

KBR/Halliburton (France)
(US) (Israel) Telia Company AB (US)
(Sweden)
Use the stick rather than the carrot in the future economic.
Company managing directors have a responsibility to know
where those risks are and to decide how to confront them.
48
1 FCPA Cases
Data Source: ICAEA 2019 Report 49

1 FCPA Connection
50
1 Current Enterprise Management Environment?
COMPLIANCE
LAWS
RULES
REGULATIONS
GUIDELINES
DIRECTIVES
Source: ACL RECOMMENDATION 51

2 What is Regtech?
52
2
New Regtech Applications
Anti-Money Laundering (AML)
Counter-Terrorist Financing (CTF)
Customer Due Diligence (CDD)
Know Your Customer (KYC)
Financial Action Task Force (FATF)
Governance Risk and Compliance (GRC)
Foreign Corrupt Practices Act (FCPA)
Markets in Financial Instruments
Directive II (MiFID II)
Payment Services Directive (PSD2)
General Data Protection Regulation(GDPR)
BlockChain Audit and Compliance
Identity Verification (IV)
……………
53
2 Total Compliance Cost by Industry
46% of customers choose using digital channels
Data Source: Globalscape’s Ponemon report

54
2 Technology for Regtech
55
2 COSO Internal Control Framework
(Source: COSO, 2013)

2 Defense Framework for Organization
Data Source: IIA 57

We need to have joined IT and

accounting talents.
58
Critical Thinking
59
10 Threat is changing for your money
60
10
Where is your Money?
How to audit Money?
61
12 Financial Accountability vs. Green Accountability
62
12 Green Economic: 2022 Taiwan-India/Global Bamboo-Tech Forum
ESG 63
13 Regtech and Computer Auditing Student Project Contest
64
13 Internship and Exchange

https://teep.studyintaiwan.org/
13 Welcome to join our AIT PhD Program (English)

Top One AIT Research School in Asia
Since 2005
66
14 5 principles for evolving CPA licensure - 2019

Principle 1
The competencies, services Principle 4
and attitudes of CPAs need to The profession, and therefore
continually evolve in order to entry into the profession,
protect the public interest. must be redesigned to attract
individuals with technological
and analytical expertise.
Principle 2
Technological and analytical
expertise are essential to
performing assurance work, as
well as the other services that
are currently, or will be in the Principle 5
future, core to professional The changes must be rapid,
accounting. transformational and
substantive without negatively
Principle 3 impacting candidates
currently in the pipeline.
Sustaining the profession and
continued public protection
require rethinking initial
licensure requirements.
67
14 What is AUDITING?
A - Analytic
U- Uncertainty
D- Data
I - In
T- Time
68
Q&A
69

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Accounting Eras 5.

Taiwan- India Joint Research Center on Artificial

Research Center Opening

Photo Source: https://www.theguardian.com 55

Where is Auditors' Future Job?

Accountants and auditors 0.94

Published by the Oxford Martin Programme on

Data Source: 2017 ACL 7

Accounting Education Shift

Standard A7 is a new standard for

AICPA CPA Exam changes 2021

Source: AICPA, 2019

The purposes of the society are:

Computer Auditing: The Way Forward

CAATs Paradox for Auditors

It is a good skill, but I do not know how to learn……….

Auditor’s Competency to Audit Performance

Self-Efficacy Theory (SET)

2019 Data Analytic Case Competition

2019 Data Analytic Case Competition

CPA's Technology Mindset & Data Analytic Skill

Source: Lu, 2020

Current Status of CAATs from IIA

2022 Computer Auditing Survey

Diligent Ltd. CaseWare Ltd. Picalo -

The Fastest Digital Transform Era

Source: McKinsey, 2020 23

Source: McKinsey, 2020 24

Audit Data Analytic after COVID-19

New Audit Data Analytic =

2022 ICCP Competency Framework

ICCP Exam Review

ICAEA 2023 in Chicago, USA

HOW TO PUBLISH A PAPER?

Chief Editor or Associate Editor Journals

Publish Game Play by Four Parties

Author View Point:

 very low acceptance rates;

What was the good of doing research in accounting?

If you imagined that accounting was the oil of

Accounting research has as its objective the production of

Auditing: a Journal of Practice and Theory

7 1st International Conference of the Journal of Information Systems

Father of Modern Accounting

Source: Dr. Meena Sharma, 2018

1 Control vs Fine Tickets

1 Fine Game – A New Economy Risk Value Chain

1 How about HP?

1 The annual number of companies to resolve FCPA cases

1 The top 10 cases of FCPA enforcement action (2009-2017).

$579 $519 $965million $412 $398

$400 $772 $795million $384

Teva Pharmaceutical Och-Ziff Total SA

Data Source: ICAEA 2019 Report 49

1 Current Enterprise Management Environment?

Source: ACL RECOMMENDATION 51

2 Total Compliance Cost by Industry

46% of customers choose using digital channels

Data Source: Globalscape’s Ponemon report

2 Technology for Regtech

2 COSO Internal Control Framework

(Source: COSO, 2013)

2 Defense Framework for Organization