In this edition we look at the effect of technology on audits, Windows vulnerabilities, Digital Firms, Phishing scams and digital file notes. We also look at a few business apps and other tips and tricks, which I hope, you find useful. Of course, I encourage you to take note of “Zoe’s Tips” which is aimed at providing tips to members on how to best utilize the technology made available from the Executive Office.
I remind members that we will once again be holding an IT Workshop at this year’s International conference in Hanoi. The Workshop will be held on Thursday 14th July from 15:30 to 17:00 and I encourage delegates to come and join us for what I believe will be a highly informative and worthwhile session.
The aim of the Workshop is to provide practical tips and solutions to members on how they can best use information technology in their day to day lives to help manage client expectations and to assist in keeping us at the top of our game.
The session will be run in an informal style providing ample opportunity for members to pose questions about material that is presented and also in seeking assistance with any aspect of how IT impacts on their working lives. I look forward to seeing many of you in Hanoi and I hope you take the opportunity to join us at the IT Workshop.
I trust you will enjoy reading our newsletter and please feel free to contact myself or the other members of the DFK IT committee if you have questions or suggestions on any matter relating to information technology and its usage in our practices and our lives.
Paul Fiumara, Chair, DFK International IT Committee
Meet the Committee
Paul Fiumara, Chairman, Australia Rahul Doshi, Dubai
Ragunathan Kannan, Deputy Chairman, India Graham Hauck, USA
Mike Basilicato, USA Ray Mack, Canada
Marc Belanger, Canada Gabriel Soto, Mexico
Anne Brady, Ireland Boris Vidas, Croatia
Jose Luis Calvilllo, Mexico
Transforming audits with artificial intelligence
by Paul Fiumara, DFK Hirn Newey, Brisbane, Australia
I always pay special attention when I read of technology pieces which impact on our every day lives and in particular, our business lives. Previously I have made mention of a 2013 paper written by two Oxford University academics titled “The Future of Employment: How susceptible are jobs to computerization?” In their paper, the authors rated 702 occupations by assigning a numerical value to their vulnerability to be replaced by various forms of computerisation, including robots, sophisticated data-scanning software or autonomous vehicles.
The authors looked at factors such as the degree of manual dexterity, originality, social perceptiveness and negotiation skills required in the role. Jobs ranked nearest “0” were deemed to be not computerisable, while jobs with a value of “1”were regarded as highly vulnerable. For example, recreational therapists topped the list as the least vulnerable being ranked at 1 (out of 702) with a score of 0.0028, while telemarketers were the lowest ranked in the list at number 702 with a score of 0.99 meaning a 99% likelihood of being made redundant within the next 14 years.
The authors listed 10 “disruptions” in their paper that are plausible by 2030, including the penetration of artificial intelligence or robots into skilled occupations. They also looked at how many “knowledge-based” tasks are highly vulnerable to sophisticated algorithms that can sift data, and detect patterns and exceptions. These included accountants and auditors which were ranked at 589 (out of 702) with a scoreof 0.94, and tax preparers which ranked at 695 (out of 702) with a score of 0.99!
In case you might think that this is just wild speculation, consider this article by Lisa Chehab who is an audit and assurance partner from Deloitte. Read the article here.
Her article looked at how technology has impacted on audits within the area of Self Managed Superannuation Funds and more particularly how the audits have “transformed” through the use of artificial intelligence.
She refers to the power of advanced data analytics, clever technology platforms and data analytics combining to deliver smarter, faster, cost effective audits at greater scale.
Interestingly, she also refers to utilizing robots to perform certain audit procedures. “Some organisations have already released advanced machine learning robots which are trained to read, analyse and predict risks across supporting documentation, such as contracts. This will mean that auditors will no longer be spending time reading and trawling through supporting documentation to perform the same analysis”.
The author opines that with increasing use of artificial intelligence (AI) technologies the role of the auditor will shift towards a focus on exception based testing and the provision of greater insights to clients. A controversial topic among auditors is whether data analytics complemented by AI technologies could fully automate an SMSF audit without any human intervention. While an auditor’s professional judgement and experience cannot currently be automated, it is clear that the profession will be enhanced and is capable of developing in important new ways.
Let me leave you with Lisa’s final comments in her article: “As we think of the shifts into a knowledge economy that internet technology and the world wide web have made (a protocol system that is literally only 30 years old), we have to accept that advanced analytics and AI technologies will transform the role of an auditor and raise the bar on client experience, so taking auditing to the next level”.
Important: Uninstall QuickTime for Windows
by Paul Fiumara, DFK Hirn Newey, Brisbane, Australia
Apple’s QuickTime used to be a common install for many Windows users – thanks mostly to iTunes – but it has been a long time since it was a prerequisite for playing video and audio files on Windows-based computers.
In recent days, Trend Micro discovered two critical flaws in the Windows build of QuickTime and reported them to Apple. Apple responded to Trend Micro explaining that they won’t be fixing the bugs, as they were no longer supporting it, and recommended uninstalling QuickTime for Windows. Please note however that this does not apply to QuickTime on Mac OSX.
Apple began winding down support for QuickTime 7 on Windows in 2013, when they stopped offering tools to third-party developers. The last update for Windows was some nine months ago, and in January this year, they removed QuickTime browser plug-ins on Windows. The vulnerabilities identified potentially allow a hacker to hijack a victim’s computer and infect it with malware, simply by tricking them into opening a malicious file or web download.
Trend Micro are not aware of any attacks to date by hackers taking advantage of the QuickTime 7 vulnerabilities on Windows machines, but the best defence is to follow Apple’s own advice and uninstall the programs from Windows-powered machines. The US Computer Security Readiness Team (CERT) – part of the US Department of Homeland Security – agrees. Following Trend Micro’s findings, CERT issued an alert advising Windows users to immediately uninstall QuickTime.
You can find information on how to uninstall QuickTime for Windows from the Apple website here.
It’s a Bird. It’s a Plane. It’s the Digital CPA! Leaping tall buildings in a single byte
By Gale Crosley, CPA – Crosley Company, 13 April, 2016 (Reprinted with permission – see original here)
We may have arrived a bit late to the party, but it’s safe to say that accounting has finally entered the digital age. Is technology a caped crusader that will imbue us with super human powers? Or will it do little more than help us keep up with the Joneses in a fast-changing world?
What is a digital firm?
We’ve facilitated counting and calculating dating from the advent of the Roman abacus around 2,400 BC. In 4,400 years we’ve made some impressive strides. Today, it’s a digital smorgasbord of personalized client portals, mobile apps, social media, CRM software, cloud computing and more. How powerful is this technology superhero? In some cases strong enough to knock down brick and mortal buildings, permitting virtual firms to arise in their place!
All practitioners have adopted technology at some level. For the truly digital CPA, however, technology is at the epicenter of the practice, the hub from which decisions and strategies derive. Digital firms are developing and adapting leading edge tools to outpace the competition. And it’s working.
While technology has advanced in the past 30 years, it has remained largely a back room tool to support the delivery of work. Computers helped CPAs with time and billing matters, invoicing, collections and file management, boosting efficiency and streamlining operations. Fast forward to today and to digital strategies that fundamentally affect everything we do. Not just the way we deliver our service, but the client’s total experience, as well as the way we sell, market and develop new services. At digital-centric firms technology is infused in every aspect of the practice, starting with the use of social media to convey the firm’s philosophy and thought leadership, identifying buyers who like how we think.
It extends to these buyers – wherever in the world they may be – through Skype, Face Time, Google Voice or similar platforms. Ease of communication lets firms be more selective about clients, taking time to thoroughly vet them and determine that the fit is right.
Once a client is on board, cloud and portal capability permit delivery of customized services. This fosters a highly personalized client experience based on continuous communication, rather than episodic contact once a year around production of the annual audit or tax return. Being and staying in touch on a regular basis enables the CPA to spot gaps in service and recommend solutions. The result is a productive, high-touch relationship more akin to the consulting model than traditional accounting.
Other things change in turn. An example is billing structure, with some firms now abandoning hourly billing for project-based or other structures of remuneration. For others, digital capacity has changed talent acquisition and infrastructure. Some firms are even questioning the need for team members to co-exist in the same building, or in the same country for that matter.
Don your cape and do this
A common pitfall is to come at technology piecemeal—one from column A and two from Column B. It’s tempting to grab hold of an attractive software program here or a CRM solution there. But the most successful digital firms harness power from system integration—linking the front and the back of the house in a way that leads to significant competitive advantage.
There is a sea change under way in the (slow-to-change) practice of accounting. To maximize its benefit you must approach technology at the business model level, not incrementally. Don’t delay. If you wait, the niches and clients in your sights will soon be gobbled up by more digitally advanced firms, resulting in a Swiss cheese marketplace with holes big enough to fall through.
Become the captain of your own digital planet and make tomorrow happen today.
Phishing emails – The Rising Threat of Corporate Cybercrime
By Boras Vidas, iAudit, Croatia
Although the most common types of cyber-attacks are still viruses and malware, just a quick glance in our inbox and the emails that we receive during the day put a new light on the techniques used by cybercriminals to infiltrate corporate networks and steal money – phishing emails are definitely on the rise!
So what is a phishing email? Typically, a victim receives an email message that appears to have been sent by a known organization or contact. The content of the message, in the cases when it seems that it was sent by known organization, will either contain an attachment or links to install malware on the user’s device or direct them to a malicious website set up to trick them into divulging personal and financial information, such as passwords, account IDs or credit card details. While these types of messages represent the majority of phishing emails, they can be quite easily detected and users often have no problem in spotting such fraudulent emails.
However, there are also emails that appear to be sent by a known contact from the same organization and these types of phishing emails are more sophisticated and more difficult to spot as a fraud, because the person who sends it usually knows a lot of information about the target user and corporation. Attackers usually do their homework by exploring information on the Internet, social networks and other sources with publically available data about the target corporation and target user. Once they have gathered enough information, attackers prepare a phishing email, which usually looks like it is sent by a senior executive (using his/her spoofed email address) from the corporation which is targeted, asking a subordinate employee to send money to a specific bank account or make a payment to a supplier (from which an invoice is attached) etc. Following the sent email, cybercriminals might call their victims on the phone in order to get their trust and to ask them to do as instructed in the email.
So, how to safeguard against these modern ways of fraud? Beware of unusual emails, emails with grammar and spelling errors and any links in these emails. If you see a link in a suspicious email message, don’t click on it. Rest your mouse (but don’t click) on the link to see if the address matches the link that was typed in the message. If you are not sure about the authenticity of the email, consult with your IT department specialists or other colleagues from the office, or call the executive who sent you the email and verify its content. And keep in mind that these things happen every day around the world – by 2017, it is estimated that there will be 556 million cyber-crime victims annually. That is 18 victims per second, according to Alltop.com. So, be cautious and double-check the origin of such messages before you click on any links, or follow any instructions they contain.
by Zoe Daniel, Membership Executive, DFK International
Hello DFK members! Last edition I asked you to register for the DFK site – I hope you have and you have been looking at the resources we have on offer to you! In case you haven’t, I’m going to highlight three key areas that you should be using:
Marketing tools – Downloadable versions of DFK Brochures and publications are available here! Why not get your staff to logon and download these great publications to help them in day to day business?
Technical Information – Did you know the Accounting and Assurance Committee has created templates that you can download, (modify where necessary) and use in your firms? There is also access to a technical helpdesk – our committee are available to help you with any questions you may have!
Doing Business In – They are documents written by our DFK firms around the world and cover key aspects about doing business in a certain country. A lot of the basic questions that DFK member firms have for other firms in different countries can be answered by Doing Business In so why not check this first!
If you want more information about the members site you can download a presentation that I did with Emma Tran (DFK Asia Pacific Executive Officer) at the last DFK Asia Pacific Regional Conference here
Please note: We are days away from launching the IT section on the DFK members site. Whilst this area will be populated by documents from the IT committee we also want to know if your firm has any best practice IT documents that you would like to share with fellow member firms on the site? Email me at firstname.lastname@example.org
Did you know? Useful Links & Tips
By Paul Fiumara
Copy and paste are probably the most widely used typing shortcuts. Copy is CTRL + C and paste is CTRL + V.
Delete an entire word instead of deleting a single letter, pressing CTRL + BKSP will delete the entire word behind the cursor. This makes deleting text quicker if you screw up a whole word. In OS X you use the Command Key instead of the CTRL key.
Move Cursor to beginning of the next word by pressing CTRL + Right Arrow or the previous word by pressing CTRL + Left Arrow. In OS X you can accomplish the same using the Option key and the left or right arrows.
Fix those little mistakes. Did you know that you can undo almost any action? CTRL + Z not only allows you to undo a mistake whilst typing, but if you accidentally delete or move a file, you can hit CTRL + Z to bring it right back to where it was!
Select multiple files using the keyboard. To select a bunch of files using your keyboard, you can press Shift + down arrow to select a single file or Shift + Page Down to select a large group of files at one time.
Zooming in can be done by pressing the CTRL + plus key and zooming out CTRL + minus key. This is very handy particularly when viewing a document within a web browser.