Analytics and Auditing A comprehensive guide to understand the correlation

Analytics and Auditing – A comprehensive guide to understand the correlation

What is Analytics?

Analytics is a process of analyzing, collecting, and studying data sets in order for auditors to make conclusions from it and use it to obtain new insights and improve strategic decision-making. In other words, analytics is a technique that auditors use to examine a company’s financial data and derive conclusions from it. 

What is Auditing in Dubai, UAE?

Auditing in Dubai, UAE is a procedure in which a person is assigned the task of reviewing and analyzing a company’s financial accounts in order to determine if they are compliant with industry standards. 

Auditors in Dubai safeguard your books of account in the businesses against a variety of frauds and assist them to avoid making poor business decisions by understanding the industry and attempting to extract the correct information from financial statements using analytics.

Different Types of Audits in Dubai, UAE

There are different types of audits. The two main types of audits are,

Internal Audits – Which are carried out by internal parties

External Audits –  Which are conducted by external audit firms in Dubai.

Other types of audits such as tax audits are conducted by the Federal Tax Authority (FTA).

Types of Analytics in Auditing

There are 05 major types of analytics that could be used by a Business.

  1. Descriptive analytics

It’s a type of analytics that describes what happened in the past. By using the information in the past, the auditors can figure out what and where went wrong. Simply, descriptive analytics provides useful knowledge about the past, which is gathered from the analyzed data from numerous data sources.

  1. Diagnostic analytics

This method is used to discover the answer to the question, “Why did this happen?” By looking at previous data or performance. Many approaches, such as data discovery , drill-down, data mining, and correlations, are used in this analysis. Because this analysis provides comprehensive insight into problems that emerge and therefore is used by some businesses.

  1. Predictive analytics

Predictive business analytics use a range of statistical approaches to build models that extract data from datasets, find trends, and offer a score for a variety of organizational outcomes.

  1. Prescriptive analytics  

Prescriptive analytics is about determining what action to take in order to avoid a future issue or seize the chance of a good trend. This assists the individual or businessman in determining the best course of action to pursue in order to make better judgments.

  1. Optimization

After the identification of the pattern and the predictions the businesses can engage simulation techniques to test out best-case scenarios in order to optimize the business.

Benefits of Analytics in Auditing

-Analytics is the best way to analyze and understand the data by representing them in multiple statistical forms. 

-Analytics helps to make future predictions and optimize the business growth.

-Computer programs are commonly used to do analytics, making the process considerably faster and more efficient for processing huge amounts of data. 

-With the use of modern technologies and because of today’s analytical skills, an auditor can now evaluate all the data at once, ensuring that the analysis is 100 percent accurate.

-Fraud detection has become a very simple task for the auditors in Dubai, as auditor can now verify every minute transaction accurately and in a relatively short period of time, allowing for a complete check on everyone.

KLOUDAC Accounting Firm Dubai, UAE

KLOUDAC is a recognized accounting firms in Dubai, UAE with 15 years of service experience. We have built connections with over 500 customers. It has also won the certification of Xero Payroll and certification of Xero advisor from the world leading online accounting software – XERO. Moreover, KLOUDAC is a golden champion partner of Xero.  Accounting and Bookkeeping is more convenient for the SMEs via KLOUDAC since they provide their clients with a whole package of services such as Financial Consultancy, Business setup, Audit and assurance services, Taxation services, Recognized accounting software and more.