Future relevance of human auditors in the AI driven landscape of Banking and Finance

Deepti Rathor

In the fast-paced realm of Banking, Financial Services, and Insurance (BFSI), the winds of change are blowing stronger than ever. Over the past two decades, I’ve stood witness to the seismic shifts brought about by digitisation and innovation. Yet, amidst this whirlwind of transformation, one force stands out as a forerunner of a new era: Artificial Intelligence (AI) and Machine Learning (ML).

As an ardent follower of AI/ML advancements, I find myself constantly on the lookout for the next frontier in this ever- evolving field. Through the lens of social media and industry insights, I endeavor to decipher the patterns and trends that shape our collective future.

In the BFSI space, where decisions carry immense weight and consequences, the role of AI is becoming increasingly pronounced. What once seemed like science fiction— systems engaging in dialogue, deliberating, and making decisions autonomously—is now inching closer to reality.

However, this shift isn’t merely about the adoption of new technology; it’s a fundamental reimagining of the roles and responsibilities within organisations. As AI assumes a more significant role in decision- making processes, the traditional boundaries between human and machine blur, necessitating assurance on ethical standards, integrity, compliance, and fairness.

In this article, I endeavour to articulate my reflections on the profound impact that AI will have in auditing space in the BFSI sector.

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By contemplating about this intersection, I seek to illuminate how the synergy between human expertise and machine intelligence is poised to redefine the boundaries of what is achievable in this critical industry.

It is not-too-distant, we can expect AI seamlessly integrated into the very fabric of the BFSI (Banking, Financial Services, and Insurance) sector. When this inevitable transformation occurs, the spotlight will undoubtedly turn towards the role of human auditors, subjecting their future relevance and significance to intense scrutiny.

Will their role evolve to complement AI systems, focusing on higher-order analytical tasks that require human intuition and judgment? Or will advancements in AI render traditional auditing roles obsolete, necessitating a fundamental re-evaluation of the human auditor’s place in the industry?

In the auditing domain, it’s abundantly evident that “AI auditors” are poised to revolutionise and largely take over the conventional audit functions currently handled by humans. These digital auditors would offer unmatched efficiency, speed, accuracy, adaptability & scalability at a lower cost. Moreover, the prospect of AI auditors collaborating among themselves would represents a new frontier, where algorithms complement each other’s strengths to ensure flawless audits. This shift would signify not just a technological advancement, but a fundamental revolution in entire auditing practices.

So, what will remain for human auditors when machines do all the work?

Well!! The future relevance of human auditors is assured, albeit in a transformed capacity. While AI auditors will carry out the bulk of audit tasks, human auditors will emerge as custodians of trust and guardians of ethical standards, ensuring the integrity and reliability of audit processes. Their pivotal role will entail quality assurance and peer review of AI-generated audit outcomes. Human auditors will leverage their expertise and judgment to evaluate the accuracy, thoroughness, and relevance of AI– generated results. This symbiotic relationship between humans and machines will co-exist, necessitating the development of new syllabi, guidelines, standards & regulations to support & protect this eco-system.

Thought to conclude my thoughts with a personal anecdote.

A few days ago, during a conversation with a colleague, we delved into the captivating realm of audit’s future. Our dialogue ignited a cascade of ideas, particularly when we pondered the potential of AI auditors taking centre stage, possibly even auditing each other. The concept both fascinated and challenged us, leading to a profound exploration of what this future might entail.

We found ourselves contemplating the profound implications of such advancements unfolding within our lifetimes. How would our roles evolve? What new skills would be required to navigate this terrain? And perhaps most intriguingly, how would this transformative shift ripple across industries and reshape our world?

As we envisioned a future where precision and efficiency were heightened to unprecedented levels, we couldn’t shake the sense of awe mingled with uncertainty. The prospect of AI-driven auditing becoming the new norm was both exhilarating and daunting, underscoring the rapid pace of technological innovation and its profound impact on our professional trajectories.

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In those moments of deep reflection, we glimpsed a glimpse of a future where AI and human ingenuity intertwine, reshaping the very essence of our work and challenging us to adapt and thrive in a landscape of limitless possibilities. And as we contemplated the profound changes awaiting us, we couldn’t help but wonder: what other marvels lie on the horizon, waiting to be discovered.

Views expressed by Deepti Rathor, Head – Internal Audit, Jio Finance Limited

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