Economic implications of technological innovations in forensic audit: enhancing financial integrity and corporate governance

The article discusses innovative approaches in forensic audit and their impact on the detection and prevention of financial fraud. Modern technologies such as big data analytics, machine learning and blockchain are transforming traditional auditing methods, providing higher accuracy and efficiency in identifying anomalies in financial statements. However, with the introduction of these technologies, certain challenges arise, including the need for qualified personnel, high technology costs and problems integrating new methods into existing processes. The purpose of the is to analyse the advantages and disadvantages of using digital technologies in forensic auditing, assess their impact on the process of detecting financial misstatements, as well as disclose the economic effect of using such technologies. Based on the analysis of real-world cases and the application of a methodology based on a comparative analysis of traditional and innovative approaches, the article provides recommendations for practitioners in the field of audit and risk management. The results of the study emphasize the importance of adapting to new technologies and suggest ways to solve emerging problems, which can help increase confidence in financial reports and improve corporate governance. The article is of practical importance for audit firms, companies and researchers interested in current trends in forensic auditing and the fight against financial fraud.

1. Rastegaeva F.S., Halitova A.Z. (2024) Postroenie metodiki nepreryvnogo forenzik vnutrennego audita kommercheskoj organizacii v celjah predotvrashhenija moshennichestva // Kreativnaja jekonomika. Tom 18. No. 7. P. 1643–1666. URL: https://doi.org/10.18334/ce.18.7.121393. (In Russian).

2. Ken F., Matthew C., Jonathan Ch. (2023) Detecting Fraud Using Emerging Technology: Don’t Be Afraid to Innovate. URL: https://www.jsheld.com/insights/articles/detecting-fraud-using-emerging-technology-dontbe-afraid-to-innovate. (In English).

3. Lashhinskaja N.V., Nesterov P.D. (2023) Audit i forenzik kak instrumenty predotvrashhenija sushhestvennyh iskazhenij buhgalterskoj (finansovoj) otchetnosti vsledstvie moshennicheskih operacij // Upravlencheskij uchet. No. 2. (In Russian).

4. Albrecht W.S., Albrecht C.C., Albrecht C.O., Zimbelman M.F. (2019) Fraud Examination. (In English).

5. Rathore R.R. (2023) Comparative Study of Forensic Accounting and Audit: Understanding Their Similarities and Differences in Practice // International Journal of Creative Research Thoughts (IJCRT). Vol. 11. No. 2. P. 453–470. (In English).

6. KPMG. AI in financial reporting and audit: Navigating the new era. 2024. URL: https://assets.kpmg.com/content/dam/kpmg/xx/pdf/2024/04/ai-in-financial-reporting-and-audit-web.pdf. (In English).

7. Dada S.O., Haron H., Yahaya S. (2020) Big Data in Auditing: Challenges and Opportunities // Journal of Business and Management. Vol. 7. No. 2. P. 42–56. (In English).

8. PwC. (2023) How blockchain will impact accounting and audit // PwC. URL: https://www.pwc.com/gx/en/services/audit-assurance/blockchain-impact-accounting-audit.html. (In English).

9. Boland P.J., Brody R.G. (2019) Machine learning in financial auditing: Opportunities and challenges // International Journal of Auditing. Vol. 23. No. 3. P. 1–17. (In English).

10. Todd M., Jeremy O. EY. (2020) Transform compliance with smarter RPA. Robotic process automation in audit. Legal, Compliance and Technology Executive Series. EY Report. URL: https://assets.ey.com/content/dam/ey-sites/ey-com/en_in/topics/assurance/forensic-data-analytics/transform-compliance-with-smarter-rpa. pdf. (In English).

11. Schreyer M., Haefner N., Biehl M. (2019) Blockchain technology in forensic auditing: Enhancing transparency and data integrity // International Journal of Digital Accounting Research. Vol. 19. No. 3. P. 112– 129. (In English).

12. Poli S. 5 Best Audit Software for Accounting Firms. 2023. URL: https://www.vintti.com/blog/top-5audit-software-a-detailed-review-for-accounting-firms. (In English).

13. Pavel Y.L., Viktor P.S., Anna N.N., Viktor M.S. (2022) Integrated application of Benford’s Law tests to detect corporate fraud // Procedia Computer Science. Vol. 213. P. 332–337. URL: https://doi.org/10.1016/j.procs.2022.11.075. (In English).

14. Dai J., Vasarhelyi M.A. (2020) Toward blockchain-based accounting and assurance // Journal of Information Systems. Vol. 34. No. 2. P. 23–45. (In English).

15. Mordor Intelligence. Forensic Accounting Market - Growth, Trends, and Forecast (2024–2029). 2023. URL: https://www.mordorintelligence.com/industry-reports/forensic-accounting-market/market-share. (In English).

16. Deloitte. Conducting Effective Remote Investigations: Practical Guidance During COVID-19. URL: https://www2.deloitte.com/content/dam/Deloitte/us/Documents/finance/us-covid-19-conducting-effectiveremote-investigations.pdf. (In English).

17. Singh M., Joshi M., Sharma S., Rana T. (2023) How Blockchain Is Transforming Accounting, Auditing and Finance: A Systematic Review // Handbook of Big Data and Analytics in Accounting and Auditing. Springer, Singapore. URL: https://doi.org/10.1007/978-981-19-4460-4_23. (In English).

18. PwC. Global'noe issledovanie vnutrennego audita 2023 g. Videt' skvoz' steny, chtoby najti novye gorizonty. 2023. URL: https://www.pwc.com/kz/en/assets/global-internal-audit-study-rus.pdf. (In Russian).

19. World Economic Forum. How AI is transforming the fight against money laundering. 2019. URL: https://www.weforum.org/agenda/2019/01/how-ai-can-knock-the-starch-out-of-money-laundering/. (In English).

20. UOB’s new AI anti-money laundering solution helps the Bank cut through large volumes of transactions to pinpoint suspicious activities. 2020. URL: https://www.uobgroup.com/uobgroup/newsroom/2020/newmoney-laundering-solution.page?path=data/uobgroup/2020/133&cr=segment. (In English).

21. SQL Server Audit (Database Engine). 2024. URL: https://learn.microsoft.com/en-us/sql/relationaldatabases/security/auditing/sql-server-audit-database-engine?view=sql-server-ver16. (In English).

22. IFRS and US GAAP: similarities and differences. 2023. URL: https://viewpoint.pwc.com/dt/us/en/pwc/accounting_guides/ifrs_and_us_gaap_sim/assets/pwcifrsusgaap0323.pdf. (In English).

23. Ken F., Matthew C., Jonathan Ch. Detecting Fraud Using Emerging Technology: Don’t Be Afraid to Innovate // J.S. Held LLC. 2023. URL: https://www.jsheld.com/uploads/Detecting-Fraud-Using-EmergingTechnology-Don%E2%80%99t-Be-Afraid-to-Innovate_2023-07-26-121322_fgvo.pdf. (In English).

24. Brown N.C., Huffman A.A., Cohen S. Accounting Reporting Complexity and Non-GAAP Earnings Disclosure // The Accounting Review. 2023. Vol. 98. No. 6. P. 37–71. URL: https://doi.org/10.2308/TAR-20180760. (In English).

25. Hongdan H., Radha K.Sh., Robin J., Chima M., David B. Accounting and auditing with blockchain technology and artificial Intelligence: A literature review // International Journal of Accounting Information Systems. 2023. Vol. 48. No. 100598. URL: https://doi.org/10.1016/j.accinf.2022.100598. (In English).

26. PwC. Impact of Artificial Intelligence on Fraud and Scams. Report. 2023. URL: https://www.pwc.co.uk/forensic-services/assets/impact-of-ai-on-fraud-and-scams.pdf. (In English).

27. EY. AI in Financial Auditing: The Next Step in Digital Transformation. 2021. URL: https://www.ey.com/en_fi/insights/assurance/how-digitization-transformed-the-audit. (In English).

28. Shewale R. (2024) How many companies use AI? URL: https://www.demandsage.com/companiesusing-ai/. (In English).

29. Blockchain and corporates: unleashing potential. Technology, flow. 2020. URL: https://flow.db.com/more/technology/blockchain-and-corporates-unleashing-potential. (In English).

30. Jacques B., Eric H. (2018) McKinsey Global Institute. Skill shift automation and the future of the workforce // Discussion paper. (In English).