Artificial Intelligence Audit Risk Mitigation

IRBA recently issued a communique containing information generated by artificial intelligence (AI). It was reviewed and authorised for issue by the Director: Standards. Here are some unedited excerpts:

We bring to the attention of registered auditors and firms the growing use of AI tools in the auditing profession, and the potential risks that they pose to the integrity of their work. Specifically, we highlight the use of GPT-3, an AI tool that has the capability to generate natural-sounding language, including written text, which can be used to create false evidence and fabricated working papers. While the potential of this technology is significant, it also presents a major risk to the integrity of the audit process. This can lead to inaccurate conclusions and misstatements in financial statements.

In order to mitigate these risks, we strongly recommend that registered auditors and firms implement safeguards.

In conclusion, we want to remind registered auditors and firms that as registered auditors, they play a critical role in ensuring the accuracy and integrity of financial information that is relied upon by investors, stakeholders and the public.