Artificial Intelligence for Audit, Forensic Accounting, and Valuation

CHAPTER 7Obtain, Retain, and Preplan with AI

CAN ARTIFICIAL INTELLIGENCE (AI) be used to assess and compare the cultures of companies? MIT researchers think so. MIT Sloan launched a study to measure and compare culture across various companies (Sull et al., 2019). Known as Culture 500, MIT researchers used natural language processing to evaluate values like agility, collaboration, customer, diversity, execution, innovation, integrity, performance, and report. Using data from Glassdoor, the research study focused on classifying words (sentences) written by employees or former employees in Glassdoor. These words became the hunting grounds for the researchers to identify patterns that can help evaluate the culture of a firm. The researchers wanted to understand how to classify words into cultural categories. To make it work they trained the algorithm by developing custom hand‐coded features. The results turned out to be fascinating, as they were able to study and compare cultures of hundreds of companies. The lesson here is that audit firms can deploy tools that can provide rapid and continuous assessment of a prospective client in creative ways. Just as the Culture 500 artifact has been trained to identify and measure the cultural elements of firms, new AI‐based artifacts can be developed to study, analyze, and warn about many areas that are part of audit preplanning. This chapter introduces you to those opportunities.

SOLVING THE BEHAVIORAL PROBLEMS IN AUDIT

One of the values ...