Case Study: ACCG340 Audit and Assurance - Cochlear Data Analytics

This case study examines the application of data analytics in the audit of Cochlear. It outlines two key ways data analytics can be utilized to enhance risk assessment, including improving audit quality through tailored approaches and increasing audit efficiency by analyzing large datasets. The study highlights the benefits of data analytics in identifying trends, anomalies, and correlations within financial statements. The assignment also discusses the challenges and barriers to implementing data analytics, such as ensuring data accuracy and complying with professional ethics. The importance of investing in appropriate tools and interpreting results is also discussed, emphasizing the need for material information. The study concludes by emphasizing the value of data analytics in the audit process, leading to better informed risk identification and more accurate control assessment.

Running head: AUDITING AND ASSURANCE
Auditing and Assurance
Name of the Student:
Name of the University:
Author’s Note:

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Table of Contents
Introduction......................................................................................................................................2
Discussion........................................................................................................................................2
Conclusion.......................................................................................................................................3
References........................................................................................................................................4

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Data Analytics in Auditing
The two key ways that the Cochlear Company can deploy for the exploration of various
large and complex data can be better done with the help of the data analysis that would be
ultimately useful in the risk assessment process. Analytical Procedures, Control Testing and
better Risk Assessment can be some of the key points that would be helping the auditors in
conducting the risk assessment process. (Annualreports.com 2019). The two key ways whereby
Data Analysis can be used for the purpose of better identifying Audit Risk can be as follows:
 Enhanced Audit Quality: The application of data analysis and various other
technological tools would be helping in better tailor the audit approach and process
(Ifac.org 2019). Methods like forward looking approach, a dynamic process that
involves identification and selection of anomalies, various trends, correlations and
associated fluctuations that the company might use for the process of identification of
trend and better assessment of financial statements (Journal of Accountancy 2015).
 Increasing the Efficiency of Audit: The application and usage of data analysis could
be well helping in assessing and analyzing large volume set of data. The set of data can
be well analyzed with the help of the frequency testing approach where large complex
set of data can be more tested on an annual frequency basis. It is crucial to note that
engagement and involvement in continuous testing and monitoring of various data
would be leading up to better informed risks identification process and more of accurate
control assessment process. Efficiency in the audit process would further allow in better
and timely reporting of the audited financial statements of the company. Application of

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data analytics in the audit process would be acting as a value over and above the normal
audit process that is followed by the company (International 2019).
The key barriers that the company primarily would be facing will be in the availability and
application of correct data set in the auditing process. The data set should be material enough so
that the same can be better applied and used in the auditing analysis. The auditors would be
needing to comply with the various set of professional ethics and various other independent
requirements that would be engaged with clients. Under the new set of requirement it would be
considered appropriately usage of data analysis can further create a challenge in the normal audit
process that is followed by the company.
It becomes well important for the Cochlear Company that the firms make significant
investments tools and technologies and better data analysis that would be helping the company in
better assessment of financial data. Further, at the same time materiality plays an important role
and the concept should be well prevailing when using various data analytics tools and software’s.
The results generated from the data analytics tools and software should be well interpreted so
that the same presents material information about the company’s financial data.

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References
Annualreports.com. 2019. [online] Available at:
http://www.annualreports.com/HostedData/AnnualReports/PDF/ASX_COH_2018.pdf [Accessed
4 Oct. 2019].
Ifac.org. 2019. Audit Data Analytics: Opportunities and Tips | IFAC. [online] Available at:
https://www.ifac.org/global-knowledge-gateway/audit-assurance/discussion/audit-data-analytics-
opportunities-and-tips [Accessed 4 Oct. 2019].
International, A. 2019. The application of big data & data analytics in auditing - Auren
International. [online] Auren.com. Available at:
https://www.auren.com/blog/audit-assurance/2019-01-18/the-application-of-big-data-data-
analytics-in-auditing [Accessed 4 Oct. 2019].
Journal of Accountancy. 2015. Data analytics helps auditors gain deep insight. [online]
Available at: https://www.journalofaccountancy.com/issues/2015/apr/data-analytics-for-
auditors.html [Accessed 4 Oct. 2019].