The Impact of Audit Technology on Audit Outcomes : Technology-Based Audit Techniques’ Impact on Internal Auditing

Although auditors invest significantly in technology, research has provided limited evidence of the ability of audit technology to enhance audit outcomes. Using a unique and proprietary dataset, our study examines the effects of technology-based audit techniques (TBATs) on the efficiency and effectiveness of internal audits as well as on internal auditors' perception of stakeholder reliance on their audits. Using a dataset that measures individual audit engagements, we found that the degree to which TBATs are used is positively associated with more efficient and effective audits and with more perceived reliance on audit results. We also found that TBATs' impact depends on the particular phases of the audit in which they are used. Specifically, we found that effectiveness and efficiency are improved in all areas except when used in planning where TBATS are associated with increased effectiveness but not increased efficiency. Our findings contribute to the discussion about the costs and benefits of using technology in internal audits and assurance work more generally