The 21st century has been host to a number of information systems
technologies in the areas of science, automotive, aviation and supply
chain, among others. But perhaps one of its most disruptive is
blockchain technology whose origin dates to only 2008, when an
individual (or perhaps a group of individuals) using the pseudonym
Satoshi Nakamoto published a white paper entitled Bitcoin: A
peer-to-peer electronic cash system in an attempt to address the threat
of "double- spending" in digital currency.
Today, many top-notch global organizations are already using or planning
to use blockchain technology as a secure, robust and cutting-edge
technology to better serve customers. The list includes such well-known
corporate entities as JP Morgan, Royal Bank of Canada, Bank of America,
IBM and Walmart.
The tamper-proof attributes of blockchain, leading to immutable sets of
transaction records, represent a higher quality of evidence for internal
and external auditors. Blockchain technology will impact the performance
of the audit engagement due to its attributes, as the technology can
seamlessly complement traditional auditing techniques. Furthermore,
various fraud schemes related to financial reporting, such as the
recording of fictitious revenues, could be avoided or at least greatly
mitigated. Frauds related to missing, duplicated and identical invoices
can also be greatly curtailed.
As a result, the advent of blockchain will enable auditors to reduce
substantive testing as inherent and control audit risks will be reduced
thereby greatly improving an audit's detection risk. As such, the
continuing use and popularity of blockchain will mean that auditors and
information systems security professionals will need to deepen their
knowledge of this disruptive technology.
If you are looking for a comprehensive study and reference source on
blockchain technology, look no further than The Auditor's Guide to
Blockchain Technology: Architecture, Use Cases, Security and
Assurance. This title is a must read for all security and assurance
professionals and students looking to become more proficient at auditing
this new and disruptive technology.
