CaseWare Analytics Success: Mark Mayberry, BDO USA LLP
My name is Mark Mayberry. I am a director with BDO USA. BDO is a national CP firm, we are primarily focusing on financial audits for public companies, private companies. We also have a bunch of specialty areas.
So BDO USA is a member firm of BDO international which is a global group of CPA firm across the world, over 100 countries with hundreds of offices.
Primary value I see of doing data analysis is that you’re able to look at a hundred percent of the data for whatever criteria that you’re looking for, so while it may seem that there are hundreds, thousands or millions of records, in reality you’re really looking for those exceptions and with using a tool, using data analysis tools, helps you sit through all that volume of data to really get to try to find the true story of what’s going wrong, what the wrong patterns are that are in the data. It’s very powerful, it can save us a lot of time on our financial statement audits and it can also help us focus quite a bit more on what we’re looking for with the tools that we have available to us and access to the data that we have better than we used to have.
I think it’s actually enabled us to do, to work smarter and audit smarter, and actually can be a significant time saver as well, so I’m-professionally for me I’d like to talk about the use of computer assisted audit techniques because it helps us really get us a focused audit, but it can actually be a timer saver as well. Over the number of years I’ve been doing data analysis, I find that we’re actually having the ability to have more focused audits really drilling into those areas that are causing us some risk. The ability to do computer assisted techniques for data analysis can be very helpful for clients because you may uncover patterns in their data that they weren’t really aware of, and when you can present your client a situation that they weren’t aware of that can add value to them as a company, that actually makes them feel very happy that they hired you.
So I was once working on a case where some law firms were helping to defend people that were in prison. In the state that we were hired for, trying to figure out if the attorneys were overcharging the state and trying to recoup some money. And through some data interrogation we were able to uncover some attorneys that were building very quickly, cleaning up to 22 to 24 hours a day. So with that in mind, we were able to extract some data from there and identify millions of dollars in recovery for the state, charging back these attorneys for these overbillings.
I’ve been using data analytics and computer assisted audit techniques probably before they were called “computer assisted audit techniques”, so for quite a while. And I think the ability to use data analytics are very powerful. It helps us let the data talk to us and find out what the patterns are that are outliers, anomalies if you will. Over the number of years that I’ve been doing data analysis, I’ve looked at a number of tools that are in the market place, and the primary tool I use is IDEA. One of the reasons I like using idea is because it’s very user-friendly and it has the kind that routines in it that auditors typically do, and I think that’s very powerful. Over the last number of years, I’ve been very active in AICPA. I do speak at conferences on data analysis and computer assisted audit techniques, but I was also the primary contributor to developing the IT audit school for the AICPA.
As part of my committee work with the AICPA, I felt there was a need out there for some sort of educational program for IT auditors to learn more about that fits in with financial statement auditing. It’s kind of a disconnect down in the marketplace, and so I helped the AICPA develop the IT audit school, and my primary role on that was to help the IT auditors understand the power of computers as an audit technique and how they could fit in to both an IT audit and a financial audit and how we can bridge that gap.
It’s important for the IT auditors to understand how to link the financial statement audits so that we’re focusing on the primary areas that create potential financial risk, financial statement risk. Otherwise, you could seem to go down the wrong track, but if you focus on the risk areas for the financial audit, then the IT auditors have the skills to ask those questions of the IT group to get access the data for either control reviews or for financial statement analysis.