CoinMarketCap Academy takes a look at the ways blockchain is changing the audit and assurance industry. Let's find out how the Big Four are using this technology!
Blockchain business opportunities are the hottest topic in the corporate space with countless companies exploring the field. Despite being a relatively young development, blockchain has shown massive prospects in a variety of industries from non-fungible tokens (NFTs) to decentralized finance (DeFi). It is also viewed by many as an alternative to SWIFT and an essential add-on to AI and robotics.
Though we have already seen a variety of blockchain use cases, it is obvious that we have only grazed the surface of its full potential. Professional auditors continue to scrutinize the algorithm to understand it better and discover new possible areas of its application. Let’s discover how the Big Four accounting companies do that and why you should put a blockchain auditor on your dream jobs list.
How Auditing Can Benefit From Blockchain
In 2020, Forbes Insights and a Big Four company KPMG conducted in-depth research on the prospects of the auditing space. 93% of the respondents questioned by Forbes stated that auditing as a job needs to undergo massive changes. Moreover, 79% of professionals taking part in the survey claimed that blockchain could help with that. Or rather that the auditor must be up to date with the decentralized technologies.
Another Big Four player, Deloitte, explains in its paper how exactly blockchain can be used by an auditor. Sandro Psaila, an audit and insurance manager behind the investigation, suggests that any process that needs to be verified by two (or more) sides can be automated via blockchain. That said, instead of selectively verifying banking transactions, which is technically hard and time-consuming, an auditor could just go to a blockchain and check a public record for all required operations.
Moreover, as decentralized databases allow their participants to go through transactions records without any intermediaries, that could save not only time, but budget as well. Psaila goes even further and claims that, at the end of the blockchain road, ‘fully automated audits may be a reality’.
The Big Four and Blockchain Auditing
The Big Four started experimenting with blockchain almost from the beginning. Over the years, they have been examining the decentralized technology to perfect its applications in many fields, with auditing being a top priority. Here we list some of the key achievements in the field made by PricewaterhouseCoopers (PwC), Deloitte, Ernst & Young, and KPMG.
PwC
PwC's Crypto Center and its high-qualified professionals help firms to integrate crypto and blockchain into their businesses. The company's priority is merging crypto with financial services.
Among other issues, PwC tries to facilitate the registration of crypto firms for its clients, along with issuing regular reports on crypto tax and regulation state. It also provides an auditing tool Halo that helps firms to easily use crypto transactions in their daily practice.
Deloitte
Deloitte opened its NY-based blockchain lab, which has already onboarded over 800 professionals from different countries. According to the project’s website, Deloitte has prepared over 30 blockchain-related prototypes in various fields, including digital identity, cross-border payments, trade finance, loyalty, and rewards programs.
One of the interesting cases described by the company is using blockchain in real estate for property transactions like purchase, sale, financing, and leasing. For instance, with purchase, a deal can be consecutively confirmed by the owner, buyer, lawyer, and local authorities with no counterparties at all. The records on the sale will be stored publicly so that any further potential owners could access them easily. Probably, it’s time to mention another dream job here: a blockchain realtor.
Ernst & Young
Ernst & Young is working on innovating the blockchain systems directly. It recently came up with its own algorithm. Paul Brody, EY's global blockchain rep, claimed that the company had teamed up with Microsoft and ConsenSys in order to create an open-source blockchain called Baseline Protocol.
The decentralized solution runs on Ethereum's public mainnet. According to the project description, it provides a set of tools and libraries that allows enterprises to synchronize complex business processes and verify that data is exchanged securely between counterparties, or prove certain attributes of that data.
KPMG
KPMG’s KPMG Blockchain Services excels in software-based solutions. Blockchain strategies and operating systems, are among the recent ventures of the firm. Apart from the distributed tech, the firm is exploring AI as well.
In 30 countries where the program works KPMG offers collaborative services with Microsoft, delivering strategy, security, cost, privacy, performance, risk management and more to clients.
What Will a Blockchain Auditor Do?
First and foremost, a blockchain auditor should know how to build a bridge between traditional record-keeping processes and a decentralized database. Depending on the needs of a particular client, one must be familiar not only with various back-office activities, such as financial reporting and tax preparation but with blockchain and its principles as well.
In fact, in the nearest future, you will be able to add blockchain skills to your existing career profile in real estate, logistics, usage rights, the finance sector, or even cybersecurity. Whenever your client is pursuing blockchain business opportunities, you should be able to analyze whether the whole system is going to work transparently and effectively.
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