Automated Audit System Using Neural Networks for Financial Data Analysis
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Solution Overview
Problem
Conventional financial audit systems are laborious, prone to manual errors, and costly, with auditors relying heavily on skill and experience, making them inefficient and inaccurate, especially in providing 'reasonable' assurance for financial statements.
Innovation Solution
A computer-implemented system using artificial neural networks to analyze financial data, generate machine-coded outputs, and iteratively refine risk assessments, reducing manual intervention and improving accuracy through automated analysis and reporting.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Reliability
If manual audit processes are used by qualified auditors, then professional judgement and interpretation of audit evidences can be applied, but the process becomes laborious, time-consuming, and costly
Solution Approach 1:
The patent replaces manual mechanical audit processes with an automated computer-implemented system that uses optical character recognition (OCR), natural language processing (NLP), and machine learning algorithms to extract, analyze, and evaluate financial data, thereby maintaining audit accuracy while dramatically improving efficiency
Solution Approach 2:
The system enables self-service audit capabilities by automatically performing data extraction, risk assessment, and audit evidence analysis without requiring manual intervention from qualified auditors for routine tasks, allowing the system to serve itself in completing audit procedures
2Adaptability or versatility
If manual data entry and processing are performed, then flexibility in handling various financial documents is maintained, but calculation or data entry errors occur and productivity decreases
Solution Approach 1:
The patent replaces manual data entry with automated optical character recognition (OCR) and natural language processing (NLP) systems that extract data directly from financial documents in various formats, eliminating human error while maintaining the ability to handle diverse document types through adaptive processing algorithms
Solution Approach 2:
The system achieves universality by designing a multi-functional platform that can process various financial document formats (PDF, Excel, images) and perform multiple audit tasks (data extraction, validation, analysis, risk assessment) through a single integrated automated system, eliminating the need for manual adaptation to different document types
3Productivity
If automated workflow is used to convert paper documents to digital files, then productivity gain is achieved, but deep understanding of financial documents and trending comparison remains tedious and laborious
Solution Approach 1:
The patent replaces manual analysis of financial documents with automated natural language processing (NLP) and machine learning algorithms that perform deep understanding of document content, extract meaningful insights, and conduct trending comparisons automatically, eliminating the tedious manual analysis phase while building upon the initial digital conversion
4Reliability
If audit strategy is developed based on auditor skills and experience, then professional judgement is applied, but the strategy may or may not be accurate and depends on individual expertise
Solution Approach 1:
The patent replaces dependence on individual auditor skills and experience with a standardized computer-implemented system that applies consistent algorithms, risk assessment models, and analysis frameworks to all audit engagements, ensuring uniform accuracy and reliability while reducing variability based on individual expertise
Solution Approach 2:
The system utilizes parameter changes by dynamically adjusting risk assessment parameters, analysis depth, and audit procedures based on the specific characteristics of each entity and engagement, allowing the standardized system to adapt its complexity and focus to match the actual risk profile without requiring manual customization
Data Source
AI summary
Disclosed is a computer implemented system for generating assurance related planning process and documents for an entity, the system comprises a computer arrangement having a computing device communicably coupled to plurality of input-and/or output devices to acquire inputs and source data of the entity from a user and a server arrangement communicably coupled to the computer arrangement, wherein the server arrangement comprises at least one processing unit, and at least one memory unit configured to store plurality of processing instruction. Another aspect of the present disclosure discloses a method for generating an audit report assurance related planning process and documents for an entity.