Intelligent Process Automation

in Audit

Abigail (Chanyuan) Zhang

Continuous Auditing & Reporting Lab

Rutgers Business School

1

Overview

• RPA and IPA

• Audit workflow

• IPA framework

• Prototype and evaluation

• Discussion and conclusion

2

Robotic Process Automation (RPA)

• Robotic Process Automation (RPA) can run application software in the same

way that a person works with that software.

• Tasks that RPA deals with

3

Definable Standardized Rule-Based

RepetitiveMachine-readable

inputs

Intelligent Process Automation (IPA)

4

IPA

Artificial intelligence

Machine

learning

Computer

vision

Virtual

agent

NLP/NLG Others

RPA

Other technologies

Data

analyticsDrones IoT Others

“Now, with help from AI, RPA robots are learning new skills. AI enables them to

interact with UI elements to complete tasks, read and process documents,

communicate in natural language, and analyze and optimize processes.” -

UiPath, 2019

Workflow Theory

A network of workflows (Adapted from Cichocki et al., 2012)

5

The Audit Workflow

6

…

…

…

…

An Audit

Engagement

Audit

Planning

Internal

Control

Testing

Substantive

Testing

Audit

Conclusion

Framework of R/IPA Implementation

7

• Identify the primary and all the lower-level workflows

• Re-design the workflow if needed

• Identify the workflows that have already been automated, that could be automated, and that cannot be automated

Audit workflow analysis

• Utilize the existing automation tool if existed

• Automate using either RPA or AI if the task is automatable

• Include human in the loop if the task is not automatable

Close the inner loops • Use RPA to

close the outer loop (i.e. complete the primary workflow)

Close the outer loop

Framework of R/IPA Implementation

7

• Identify the primary and all the lower-level workflows

• Re-design the workflow if needed

• Identify the workflows that have already been automated, that could be automated, and that cannot be automated

Audit workflow analysis

• Utilize the existing automation tool if existed

• Automate using either RPA or AI if the task is automatable

• Include human in the loop if the task is not automatable

Close the inner loops • Use RPA to

close the outer loop (i.e. complete the primary workflow)

Close the outer loop

The “Auditor-in-the-Loop” IPA Ecosystem

8

Auditors

Structured audit

tasks

Unstructured

audit tasks

Semi-structured

audit tasks

• AI/cognitive

computing

• Other

• AI

• Other

AuditorsRPA

RPA

Illustrate Using a Simple Use Case

The Prototype

• Workflow analysis

The Prototype

• Close the inner loop

The Prototype

• Close the outer loop

13

Evaluation

Tested the bot 10 times on Rutgers CARLab server

The average time spent by the bot is 1:34, compared to 5 min needed by human14

Conceptual Model of IPA in Pension Audit

15

Run testing queries (RPA)

Further analysis

(DA or AI)

• Process the pension

contract and extract

relevant information (NLP)

• Populate the data into DB

(RPA)

• Clean, standardize and

extract data (RPA or

NLP)

• Populate data into DB

(RPA)Plan Doc

12

Raw client data

AuditorsInvestigate

6

Report

Automatically generate testing

report (RPA and NLG)

Notify (RPA)

3

4

5

IPA Facilitates Continuous Audit

• IPA provides new opportunities for the existing manual work in

external audits to be automated

• The automation facilitated by IPA provides chances for external

audits to be conducted more timely

• IPA is non-invasive, so the data acquisition in real time is expected

to be easier and to get less resistance from the client.

16

Discussion

Where to implement AI?

– Not where “professional” judgements are needed

17

Conclusion

• IPA could achieve flexible, scalable, and intelligent process

automation in audit.

• Auditors’ work will be further shifted to the part that needs their

professional judgement.

• IPA could enhance the efficiency and effectiveness of audit

• IPA could facilitate continuous audit

18

Please contact me at:

abigail.zhang@rutgers.edu

19

“If we knew what it was we were doing, it

would not be called research, would it?”

-Albert Einstein

“Think-Feel-Do” loop of IPA

20

Drones, NLP, IoT, etc. PPA/RPA

AI and

cognitive

technologies

Human

Think

DoFeel

The Audit Workflow Driven by IPA

21

Smart

workflow

Smart

workflow

Smart

workflow