The future of auditing: 5 tech trends that’ll change the game

You think remote auditing is ground-breaking? You ain’t seen nothing yet. Get ready for 24/7 monitoring and more! Kiwa’s corporate IT expert Eric Laan spotlights five (plus one) game-changing tech trends and innovations.

So who is this Laan guy – and why should we trust him on this? Here’s why: Eric Laan (30) is one of the trailblazers in the field of merging IT with auditing. He studied Computer Science and Public Administration at Erasmus Rotterdam University and is a specialist in where these two disciplines converge. After working as a business consultant for five years, driving digital innovation in telecom, Eric switched to Kiwa’s corporate IT department two years ago with a clear aim: to help the company push the boundaries of high-quality efficient auditing using innovative digital solutions.

‘Remote’ is only a start

In Eric’s view, remote auditing is not an innovation in the true sense of the word. “It’s doing what the market has done for years from different locations, with digital help. Ironically, we’d already been developing and preparing remote auditing technology and processes for quite some time, only to find the market wasn’t ready yet and regulators wouldn’t allow for it. COVID-19 has turned everything around. All of a sudden, remote has become the way to go. Everyone seems to love it – auditors, regulators, governments and customers alike. And this is only the beginning!”

1. IoT and big data dashboards

“The main trend driving innovation in auditing is the Internet of Things, or IoT. The number of sensors rises rapidly in every sector, it roughly doubles every two years. There are sensors everywhere – billions of them, in endless lists of machines, materials and products. All these sensors can be linked to the internet to provide us with real-time data about everything. From the condition of machines to the thickness of a layer of sheet metal in a stamping press and the chemical composition of raw materials. We can even measure the composition of the contents in the stomach of live milk cows. Imagine the impact! It’s easy to see how actual sensors can help auditors to do their work in a much more efficient way. They can inspect and measure in real time, enabling us to monitor, plan maintenance and forecast defects, malfunctioning and/or non-conformities.”

Doesn’t Eric fear data overload? “Not really. Big data analysis technologies will enable us to analyse large amounts of data at the speed of light. Microsoft among others is making rapid progress in that area, with data visualisation via clear dashboards.”

2. Digital twins and mixed reality

“The second big thing in auditing is the rise of digital twins and mixed reality. The digital twin is the successor of the physical twin – an exact live size copy of any installation, like they had during the Apollo space missions: if anything unexpected happened, they could develop and test solutions in the ‘twin’ module to support the crew up in space. These days, more and more machines, production plants, buildings, planes and spacecraft get digital twins. I know that beer brewer Heineken has digital twins of its brewing tanks, with sensors measuring every single aspect of the process – composition, temperature, alcohol – all accessible from the brewer’s iPad or laptop. Having such exact digital copies of physical installations not only helps troubleshooting. If this digital twin is continuously connected to the real installation via sensors measuring all parameters, including vibrations, loads and wear, it also makes auditing a lot easier. It can even be performed live, continuously – and of course remotely."

“Mixed reality is the way in which you can visualise digital twins and make maximum use of them. It’s a mix of virtual reality and augmented reality: you can put on a pair of VR glasses, or put a VR lens onto your eye, and see and dismantle the machine as if it were in front of you. Here too, using sensors, the digital twin you’re working on will be an exact copy of the actual machine at that very moment, including the wear and tear. Working with digital twins and mixed reality means that, for example, mechanics can check what modifications or repairs have been made in the past, why, when and by whom. This technology offers great new ways to train mechanics too. And of course to prepare and perform audits.”

3. Documents and data mining

The third big trend in auditing builds on recent breakthroughs in data mining. Digital data mixed with typed memos and handwritten documents and reports now hold no secrets from new forms of artificial intelligence and machine learning.

“This rapidly evolving technology is perfectly suitable to look into – and analyse - huge sets of data built over a long-term period. Like the history of audits in your company. There’s a big future for data mining in improving products and services too. Data mining helps you to analyse trends, get a clear view of the reliability of products and systems and optimise products, designs and services.”

4. Mobile and connectivity

“With 5G, mobile internet will go into overdrive. Even in the middle of nowhere, connections are available. Finally, auditing at remote places is made possible. At the bottom of the spectrum, increasingly better LPWAN networks have been emerging to exchange quickly with little energy consumption. Even in the harshest environments – or underground – the networks are reliable.”

Instead of putting your bulky or expensive physical installation into the field, a digital twin can do the ‘dirty work’ thousands of miles away, simply connected to each other through a LPWAN wireless network.

5. Drone Invasions – on land, at sea and in the air

As an eye in the sky, drones already are helpful assistants for auditing, boldly going where no auditor has gone before. The possibilities of where and what they can inspect are endless – and growing rapidly. Even unmanned and fully self-guiding driving, sailing and even underwater diving drones can do dirty auditing work. Equipped with smart techniques like pattern recognition or thermal vision, these are very refined remotely managed measurement tools. “They can even take samples and bring them to certified analysing labs – all remote and even robotised,” says Eric.

Auditor as a continuous process monitor

All these technologies not only change daily practice in auditing, moreover they have big impact on the very role of the auditor. Eric: “Technology enables auditors to offer real-time monitoring, and with it new levels of value for businesses. Already, customers ask us to safeguard their product quality, conformity and compliance for them, 24/7 with local laws and regulations worldwide. Think of companies such as IKEA, which may want to sell their Swedish meatballs in a wide variety of countries, compliant with local food regulations, and making sure the product is safe, high quality and perfectly compliant with every single market. By taking over that part of their quality and continuity work, a company like ours could monitor and certify – and even actually help them grow.”

Human understanding

Reading all this, you might wonder if the future of auditing will be a cold ‘big data’ game. But Eric is sure there’ll still be a key role for the human aspect. “Auditing is not just about data, but also about trust between people and organisations. Technology doesn’t build relationships: people do. Auditing without personal contact and a shared vision of human beings will not give proper outcomes. Therefore, we’ll have to learn how to balance the almost endless possibilities of technologies with the human factor. Auditing is all about understanding each other. Even in a world full of auditing drones, digital twins and artificial intelligence, human understanding will still be key.”