Continuous Auditing with AI in the Public Sector

The effectiveness of internal audit activities is important for the sustainability of change in the public sector. In this sense, the tools and techniques used and the level of competencies of public sector auditors are decisive. This book deals with the effects of current technological developments in the public sector on auditing and risk management activities. Therefore, it is a resource for public internal auditors to create a digital audit strategy based on artificial intelligence (AI) and blockchain-based applications. Institutionalisation of their structures is important for public sector internal auditors. For this, basic requirements, future expectations, and best practices are explained. The digital business model is presented to produce value-added audit findings and outputs that guide public internal auditors and all digital-era stakeholders. This book is a pioneering work based on continuous auditing/continuous monitoring approaches using various AI and blockchain-based tools and techniques.

There is nothing more valuable to the success of a public internal auditor than a detailed understanding of the business. The important lesson in developing business knowledge, especially in the new audit universe emerging with digital transformation, is that all auditors must understand that they never finish learning about business processes, risks, and control points in the digital era.

They must constantly push themselves to be motivated and learn about the business operations they audit to implement new audit approaches powered by AI. In addition to obtaining up-to-date business information from process owners and stakeholders, public auditors responsible for conducting an AI-based continuous audit programme should also look inside their departments for a different perspective on business information that impacts continuous audit programme phase details and has the potential to add value. It should be noted that the additional source of information begins with your individual audit experience, digital skills, and qualifications.

Lourens J. Erasmus is a Professor in the Department of Financial Governance at the College of Accounting Sciences at the University of South Africa (UNISA), Pretoria. His fields of academic interest include public sector financial governance and internal auditing. Lourens is Commissioner of the Financial and Fiscal Commission of South Africa, the Chairperson of the Education Committee of the Southern African Institute of Government Auditors (SAIGA), and the Treasurer of the Research Ethics Committee Association of Southern Africa. Lourens is a rated researcher and Editor-in-Chief of the Southern African Journal of Accountability and Auditing Research (SAJAAR). He is an associate editor of the Scopus-listed South African Journal of Accounting Research (SAJAR) and project leader of the registered Engaged Scholarship project, Continuous Auditing in Public Sector Internal Auditing (CAPIA).

Sezer Bozkuş Kahyaoğlu (CIA, CFE, CFSA, CRMA, CICP, CPA) is an Associate Professor of Finance at the Bakirçay University in Izmir, Türkiye, and an Academic Associate of the University of South Africa (UNISA), Pretoria, and the University of Johannesburg. Her research interests include applied econometrics, time series analysis, financial markets and instruments, AI, blockchain, sustainability, corporate governance, risk management, fraud accounting, auditing, ethics, coaching, mentoring, and natural language processing (NLP). Sezer is the Associate Editor of two indexed journals and the AI Book Series Editor at Springer. She is a steering committee member at the Good Governance Academy Research Forum and a co-founding member of the registered Engaged Scholarship project, Continuous Auditing in Public Sector Internal Auditing (CAPIA).