As I considered the theme of this month’s issue, I found myself reflecting on just how much has changed since 2020, both in my daily life as an auditor and adviser, and for my clients within the arts and culture sector.
The shift to remote working, and gradual return to the office
In 2020, my usual face-to-face meetings were abruptly replaced by video calls, with our audits moving from predominantly in-person exercises involving teams sifting through client paperwork, to conducting fully remote audits. This shift put extra strain on clients, who were required to collate and scan documents.
The end of the lockdown period allowed us to move to a more balanced approach, reintroducing vital face-to-face interactions while leveraging technology such as remote access to finance systems, to enhance the audit process and reduce the time our clients spent gathering and providing information for us.
Most organisations adapted their working practices with many embracing document storage functions in their finance systems, leading to improvements in the audit trail.
As an auditor I feel it is important for our teams to spend some time interacting with clients face-to-face in their operational environment to gain a comprehensive understanding of the organisation’s activities, and to identify any discrepancies that may not be evident from financial information alone.
For instance, a finance team which appears to be under stress may indicate financial challenges, or internal management issues. Observing an individual’s approach and body language while they walk through a process can also provide insight into how proficiently, or not, they are in performing their role.
I continue to attend many board and finance committee meetings remotely as many charities find it more practical for their trustees to schedule meetings online, especially touring arts organisations or those operating from multiple locations.
Offering remote meetings can also increase the pool from which to recruit new trustees, helping to increase diversity. In my experience, a well-chaired remote meeting can be just as effective as an in-person one.
Unless the technology is of the highest quality, I often find hybrid meetings challenging, with difficulties maintaining the same level of engagement among all attendees, with remote participants often struggling to have their opinions heard.
Technological advancements
We have seen constant technological advancements over the past five years, including the increased use of artificial intelligence (AI). AI enables my teams to interrogate huge amounts of data in ways that wouldn’t be practicable otherwise, helping us to spot trends, anomalies and out-of-place transactions.
This enhances the overall integrity of our audit process, reducing the risk of human error. Likewise in the arts and culture sector, data analytics tools are enabling organisations to analyse vast amounts of visitor data, identifying behavioural trends and preferences, and enabling controversial dynamic pricing to be implemented.
One development that many of my clients have embraced is technological advancements in accounting systems and their add-ons. The availability of various (relatively) low-cost solutions now allows even smaller organisations to benefit from the enhanced control environment that these systems may provide. This includes the growing use of automated purchasing systems, which I am seeing more and more frequently.
Such systems can save staff time, expedite the approval process, and provide a consistent documentation trail. They can be particularly beneficial for touring organisations, as they enable people to instigate purchases and approve payments from any location and at any time of day.
Many of these systems allow organisations to implement purchase ordering, which helps management to proactively monitor costs and purchasing habits – a key tool given the financial pressures that the arts and culture sector is facing.
No auditor’s article would be complete without addressing risks and fraud. While AI has assisted us in many areas, it has also empowered criminals. Phishing scams are becoming increasingly sophisticated, and deepfakes impersonating individuals are now a credible risk.
I recommend adding AI to your risk register if it’s not already included. This should include not only potential fraud risks but also the risk of falling behind in technological advancements, both operationally and creatively.
Failing to do so could leave you at a competitive disadvantage within the sector. Embrace the future of innovation today and take action to safeguard your organisation.
Jane Askew is a partner at HaysMac
Related articles
