Preparing for Audit Data Analytics with the AICPA General Ledger Audit Data Standards

It is challenging for auditors to effectively and efficiently use data analytics in audit procedures and general ledger testing when the data acquired from clients is often incomplete and not in a usable format. Considerable time must be spent cleansing, transforming, standardizing, and validating the data prior to analyzing it. This problem motivated the AICPA task force to develop a set of Audit Data Standards (ADS) for streamlining the exchange of data. This paper describes an extensive exercise where students: (1) develop a Microsoft Access database that complies with the ADS for general ledger data; (2) cleanse and transform non-standardized client data for import into an ADS-compliant database; and (3) write queries for general ledger testing and journal entry testing. The exercise strengthens students' database and query-writing skills, while introducing the ADS in the context of realistic tasks to support a financial statement audit.