Using Robotics Process Automation (RPA) in an Audit

Unit V
Topics covered…
• RPA versus legacy management systems, including benefits of RPA and steps to redesign a process
• How to audit a client's RPA - How to audit clients using RPA, including steps for implementing - RPA in your
engagement, and RPA in audit planning, internal controls and substantive testing, and reporting and
completing an audit –
• RPA versus Intelligent Process Automation (IPA) –
• Impact of IPA on an audit –
• Future trends in audit automation
RPA Vs Legacy Management
Systems
• Intertwined with the legacy systems, RPA implementation could also go only
so far, that they cover the repetitive tasks
• Intelligent Content Management Systems (ICM), which evolved a decade ago,
tried accumulating the relevant content into the database/data warehouse
• Intelligent Information Systems(IIM) were able to retrieve the necessary info
from the stored intelligent content, by embedding queries into the data
warehouses and thereby probing into the hidden insights of the data
• But managing the inhouse systems which the enterprises would have already
developed and maintained for decades together, along with these newly
developed systems, posed the challenge for integrating these legacy systems
with RPA
RPA Vs Legacy Management
Systems
• Integration of Cloud services to RPA
• Balancing the short term needs and the long term priorities
• An RPA bot programmed on top of a legacy system lacks the underlying API
connectivity for deeper, more complex automation. This bot can simply
automate and control the existing user interface. Unfortunately, 91% of teams
using RPA in 2020 reported experiencing problems with implementation, such
as managing security, maintenance, and lack of control.
RPA Vs Legacy Management
Systems
• A Poor Developer Experience
• Low key coded RPA programs for the bits and pieces of the repetitive tasks,
may sometimes not fit into the entire process. When the process is
redesigned these low key coded RPA programs stand unfit into the entire
redesigned process.
• The disruptive technologies render the existing systems obsolete and they
make the entire process redesigning a challenging task. Suddenly the
management recognizes that the investments on the low key code RPA
processes become an absolute waste
• To avoid or reduce this, the broad overview of the entire business process
must be foreseen for the business transformation cases to happen, and
provide a more flexible and open architecture to develop on.
RPA Vs Legacy Management
Systems
• To take that modernization a step further, development teams can
gradually replace RPA bots one by one with applications built on a
more modern, microservices-based architecture. This gradual digital
transformation may make sense for most enterprises that don’t want
to rip and replace legacy systems all at once. It’s far less disruptive to
the business and allows developers to re-architect and modernize
business applications in priority order based on what is most urgent
for the customer experience.
RPA Vs Legacy Management
Systems
• Often, RPA deployments seem too good to be true…because they are. Enterprises
have ambitious modernization goals, paired with a mix of complex legacy systems
and modern, cloud-based applications. Combine that with the fact that IT leaders
and business stakeholders often can’t see eye to eye on how to prioritize.
• Luckily, using open standards like business process model and notation (BPMN),
these teams can collaborate using easy-to-understand, flowchart models to annotate
their processes.
• Within these models, they can determine where people and technology interact and
identify potential issues or bottlenecks. From there, they can focus on which
automation efforts to take on first, based on what matters most to the customer
experience.
• It’s not just about quick fixes. It’s about automating and orchestrating business
processes from end to end.
RPA Vs Intelligent Process Automation:
Differences – Automation is not Intelligence
• While RPA simulates human work actions, it doesn’t simulate human intelligence. It can
download data and transfer it to its desired location, but can’t interpret the data and
draw any conclusion from it. It only operates under the rules that define its actions.
• Downloading invoices from a website or tabulating lab results in a hospital doesn’t
require any real training. The bot is guided by scripted actions that tell it to do process B
once process A is complete and so on. The software robot must be instructed or trained
on how to do something and relies on structured data to complete its assignments.
• On the other hand, Intelligent automation operates more like a complete human
because it can interpret data to make inferences and conclusions from it. For instance,
Intelligent automation is being used in logistics today to streamline supply chains by
identifying potential bottlenecks before they even happen. This predictive intelligence
helps it get the right assets and resources in place ahead of time.
RPA Vs Intelligent Process
Automation: Differences – IA
incorporates RPA
• IA utilizes multiple technologies to help it work intelligently, including
RPA. Of course, as its name implies, IA utilizes artificial intelligence
(AI) to help it simulate human intelligence. This helps it analyze data
far faster than any human can.
• It uses machine learning (ML) to help identify patterns in large
volumes of data. Other incorporated technologies include computer
vision tools such as optical character recognition (OCR) that convert
scanned documents or photos into text. Natural language processing
(NLP) is used to communicate with humans through a conversational
interface, and process mining is used to diagnose business processes
to improve upon them.
RPA Vs Intelligent Process Automation:
Differences – Ability to operate in
unstructured environment
• RPA is not suited for exceptions, but IA can handle exceptions and
self-manage themselves through unforeseen scenarios in which they
weren’t scripted to conduct.
• Process-driven work is dependent on structure. If everything exists in
an anticipated order, everything runs great. When an exception to the
rule comes to fruition, things grind to a halt.
• A new employee dealing with an issue that isn’t covered in the
employee manual must stop what they are doing and find a manager
that can provide them with further guidance or take charge of the
situation.
RPA Vs Intelligent Process Automation:
Differences – Ability to improve over time
• While an RPA can perform tasks faster and more efficiently than a
human, it is incapable of learning how to improve upon itself. AI-
driven bots can learn and adapt to data and events in real-time by
making tiny adjustments, allowing them to adapt to changing
environments. This ability to improve and adapt makes it far more
human-like than RPA.
Benefits of RPA in Finance
With the advancement of technology, the automation of the
finance sector is an increasingly common reality in companies.
• Error Minimization
• Adopting RPA helps cut down expenses, as it reduces the losses
caused by human errors. This minimization of errors, in fact, is a
great advantage of RPA, since a system can perform repetitive and
tiring tasks of endless & complex calculations without any problems.
• Increased Productivity
• Those who work in finance know that a good part of their workday is
about filling out spreadsheets, completing accounts and checking
that all items are organized.
• Therefore, using software that automates part of this work means a
direct increase in productivity, efficiency, and profitability.
Benefits of RPA in healthcare
RPA in healthcare services is an interesting option for the control of
administrative routines, decision making and management of drug stocks.
• Paperless
• Nowadays, through the internet, it is possible to access important information from
anywhere. A good example of this concept is that of not being required to use papers.
• Instead, all the documents can be shared over the cloud, which can speed up the care
of several patients and avoid long queues in hospitals.
• Health institutions generate considerable volumes of referrals and reports. Handling
this amount of paper generates a lot of administrative, logistical and financial costs.
• RPA in healthcare is a facilitator as it enables the standardization, cataloguing and
digital signature of the most frequently used documents.
• Communication
• RPA allows the centralized institutions to communicate with health operators in order
to authorize or reject the performance of a certain procedure, be it drug-related,
clinical or surgical.
• With well-established communication and scheduling, services can be less laborious
and more practical.
• RPA can also help segregate different cases as urgency, emergency, outpatient
treatment, hospitalizations, among others.
Benefits of RPA in Manufacturing

In manufacturing, automation is the process of integrating industrial machines

and equipment to automatically perform tasks. The use of RPA improves
productivity, security, and profitability.

• Competitive Advantage
• RPA is capable of providing consistent and repeatable results. When manufacturers use
automation, they can effectively eliminate issues such as quality control, managing
inventory levels, long-lasting jobs etc.
• Accuracy and Remote Monitoring
• Accuracy is one of the key benefits of RPA in manufacturing. This is because all the
variables involved in the production processes are measured by the main computer,
which usually has a built-in artificial intelligence program.
• This program ensures precision and in-time production.
• Remote operation and control systems are being increasingly integrated into most
industrial automation systems.
• These systems allow an operator to monitor and control production processes from a
pre-specified distance.
Benefits of RPA in Retail

In every-day operations, a brick-and-mortar retailer is surrounded by a series

of challenges. These include the large volume of products that make up the
store’s stock, the high flow of people in the aisles, the variety of goods and
the various peculiarities of each one. All these issues can be tackled with RPA.
• Increased Productivity & Cost Reduction
• An industrial automation system is able to reduce installation costs, as they
can offer an agile return on investment by increasing productivity and
efficiency.
• A rapid ROI makes it possible to offset the initial installation costs.
• Furthermore, RPA allows the achievement of faster production cycles with
greater efficiency and repeatability.
• Minimizing Errors and fraud
• It can also help reduce the chance of any error to practically zero, as the robot
is not susceptible to skipping steps or forgetting processes.
Benefits of RPA in Supply Chain
• Increases Visibility & Streamlined Inventory
Management
• Automating the supply chain means having visibility into all processes,
from production, inventory management and distribution to the sale of
the final product to the consumer.
• This real-time information makes it possible to know what all problems
are occurring along the route of the product.
• Anticipating the market’s need and ordering only what is necessary to
do business is a great skill, as it prevents products from stalling and
causes a greater inventory turnover.
• Responsiveness & Decision Making
• With end-to-end automation, to address different business processes,
organizations can respond more flexibly to changing market
conditions.
• Thus, having a comprehensive technological platform prepares the
industry for market changes and then it can respond quickly to
changes in demand.
Steps to redesign the RPA processes
Auditing a Client’s RPA
• RPA Implementation
• Degree of engagement of the RPA processes
• RPA audit planning
• RPA internal controls
• Substantive testing
• RPA Audit Reporting
• Completion of Audit
RPA Vs Intelligent Process
Automation: A Case Study
• Abstract
• A major healthcare product and service organization
was manually processing 800 provider license credential
cases a day and needed to streamline and cut down the
time and cost of this critical compliance verification.
SDLC Partners not only created a successful RPA
solution that cut costs by 30 percent, but allowed
process engineers to focus on additional projects to
support business growth.
• The Challenge
• The client wanted to automate the process of verifying
provider license credentials for Pennsylvania via the state
license website using Digital Assistant. The process began
with a trigger from the credentialing application.
• Because a business process engineer can only process
around six cases per hour, the team had to process 800
cases per day manually. The biggest challenge was the
process requires extensive interaction with three web
applications causing errors, lower data quality, and less
scalable solutions.
• The Solution
• We implemented a Robotic Process Automation solution
to streamline the client’s Pennsylvania state license
verification process. Previously, their process involved
verifying data in several applications to ensure the data
matched and that their providers’ licenses were active.
• The Results
• Our RPA solution was able to process each case in
three minutes with consistent results. This reduced the
need to touch the same information multiple times and
greatly increased the efficiency of their verification
process.
• Automation successfully cut verification costs by 30
percent. And, the recovered time enabled process
engineers to solve other, meaningful problems to
support business growth objectives.
Challenges to IPA
• https://home.kpmg/xx/en/home/media/press-releases/2019/03/scal
ability-of-intelligent-automation-technologies-directly-linked-to-financ
ial-performance.html
Impact of IPA on Audit
• Gathering And Cleansing Of Data For Analytics
• The RPA can create and standardize data to produce custom
analytics, including automation checks for completeness,
duplicates, and validation. As a result, internal audit is freed from
the time spent coordinating and gathering data.
• Robotic process automation in audits can also help ensure data
accuracy by providing a higher level of control and oversight
during the data entry process. For example, RPA can be used to
validate inputted data against pre-determined rules and standards
(i.e., company policy, regulatory requirements, etc.), and flag
errors for correction before moving forward with analysis.
• Risk Assessment
• When considering new opportunities or business processes,
an internal audit can use the audit RPA to help perform initial
risk assessments. RPA can quickly collect and analyze data
related to the process under review, providing a
comprehensive understanding of the potential risks involved.
• Then, it can then be used to support decision-making around
whether or not to pursue the opportunity or implement the
new process. This saves time and provides a more accurate
picture of control effectiveness.
• Controls Automation
• RPA in audit can automate controls within business
processes, providing a higher level of assurance around
compliance and reducing the risk of human error.
• This is especially beneficial in instances where controls
require real-time monitoring or are repetitive (i.e., data
entry).
• Reduce manual data entry. Automatically extract data from
documents with >95% accuracy.
• Population Gathering
• Using bots to process data populations more efficiently and
accurately than humans during the sampling and initial
proof gathering phase is possible.
• This is very advantageous when it comes to large
populations that require heavy computational resources to
process, such as analyzing thousands of statement
documents.
• By offloading this work to an RPA bot, an internal audit can
focus its attention on other aspects of the audit.
Future trends in Audit automation
• Hyperautomation
• Automation CoE
• Semantic Automation
• Chief Sustainability Officer in the C-Suite
• Human-Bot Managers in HR
• Cloud based architectural innovation
• JIT, Task-Based Workflows instead of Business Application workflows
End of Unit V