Introduction:-

A blockchain is an unchallengeable, time-stamped sequence record of information that is scattered and coped by a collection of computers. The blockchain also can progress upon systems by now in use during society (Sahlin and Levenby 2018). Blockchain technology suggests an immense potential troublemaking power, and businesses are already in the competition for several product offerings. As the business stays to grow, the blockchain stands out as the most significant venture for expected returns. It is to be capable of creating and confirming trust, lacking the need for a centralized structure. As an alternative, this power would be specified to a distributed network, making it not only more protected but also well-organized and quicker to scale (Kokina,   Mancha and Pachamanova 2017). This report demonstrates the basic description of blockchain technology and also develops the importance of this technology in the business organization.

Discussion:-

Blockchain Technology:-

Blockchain can be demonstrated as a series of the block that holds enormous information. The method is proposed to timestamp digital evidence so that it’s impossible to temper or validate them. It is using for the protected transfer of objects like property, money, contracts without demanding a third-party intermediate like government or banking sector. Once a piece of evidence is documented inside a blockchain, it is tough to alter it (Yaga et al. 2019). This technology characteristically mentions to the trustless, transparent, openly accessible record that permits the user to steadily relocate the unit’s ownership of worth using public-key encryption and evidence of approaches.

Without the help of the internet, it is impossible to run this technology. It is also named meta-technology as it disturbs other technical skills. It is inclusive of some portions like software application, a database, and some associated processers. The possibility of blockchain technology is not restricted to bitcoin as it has increased much consideration in a diversity of businesses counting charities, monetary services, and e-commerce.

Use of Blockchain technology in business:-

This technology can be used for several internet-based and computerized applications. Smart Contracts are the one type of application that allows industries to spontaneously validate and implement agreements that purpose autonomously in a secure atmosphere (Sutton and Samavi 2017). Blockchain technology performs as a middleman for executing all business protocols, business transactions, and programmed interactions of evidence in smart contracts.

Some major enterprises are using blockchains for this particular purpose. The Shipping businesses have been rapid to understand that blockchain technologies are a usual explanation to continuing clear, updated records on the status. In specific, the blockchain is anticipating to be an effective means of handling paperwork, which presently suffers from clerical mistakes and fraud. Applying a blockchain in the small industry for the aim of tracking business histories might not necessitate this decentralized configuration (Angraal et al. 2017). As an alternative, a blockchain could assist as a thorough record of credits and debits, which would once again advantage from the assurance that the documents cannot be damaging with once it has arrived.

The companies could use blockchains in much the similar method as an influential tool for quality control. If a creation being traded by the business unable to fulfill the product quality standards, discovering the point of disaster could be as simple as arriving the product’s number and inspecting the transitional stages in its creation. Dealings in industries that need related synchronization might also advantage from capitalizing in a mutual blockchain. Keeping entire parties on a similar page can go a long way near avoiding problems that harmfully affect any business customers. The blockchain can help as a piece of unchallengeable evidence to hold the responsible parties.

Impact of blockchain in Audit profession:-

Blockchain technology has the possibility to impression all recordkeeping procedures, including the method dealings, are processed, initiated, recorded, authorized, and reported. Several industry houses and other non-financial companies have started concentrating on blockchain technology and initiated assessing active areas and the use of blockchain technology for their industry. Besides, inaugurated the documentation of consultants or vendors to apply the blockchain technology (Suzuki and Murai 2017). On the other side, accountants who are involved in the examination of said commercial houses will essential to start working towards improving their practical abilities, including capability in data analytical tools to be well prepared to appear and authorize the dealings on the network under block chain atmosphere.

The Audit procedure is usually an annual implementation, mostly for the reason of effort and time capitalized in it.  Since Blockchain delivers distributed record, this technology may create it potential to conduct more regular audits on a periodical or even on a regular basis (Sikorski, Haughton and Kraft 2017). These increase the accountant’s understanding of the industry, as the arrangement is no lengthier a year-end snapshot. This opportunity can simplify the skill to spot developments or upcoming risks more aggressively.  

Opportunities:-

Blockchain aids parties in business to create an argument without the existence of a third party. These expressively decrease third-party risk (Produit 2018). Furthermore, due to its decentralized network characteristics, the blockchain does not have any essential opinion of failure and is consequently capable of withstanding hateful attacks. With blockchain skills, each transaction, both previous and current, can be confirmed at any time for validity. Blockchain does not just deal with one person authentication; rather, a confirmation can occur instantaneously within a network lacking alteration fear. Blockchain technology profits not only crypto-currencies but also several different businesses that want to stock and operate substantial data amounts (Ahram et al. 2017). Blockchain technology has the prospective to backing the economic, social, and public services like asset management, educational facilities, land record management, energy management, taxations system, citizen registration structures, patient management, security, and confidentiality augmentation of mobile devices and related services.

Challenges:-

There are specific challenges linked with the blockchain networks. There is a massive storage requirement as the authentication process includes the entire blockchain (Kshetri and Voas 2018). Only specific dealing can be executed per second due to secure block size, which in turn reasons increased transaction interruptions and a huge transaction charge.

Furthermore, it is the potential to create false blocks by the network nodes or create communications that are reverse. The Quick blocks are probable by improved power depletion, resulting in genuine blocks being unable to get their stake of blockchain network possessions. One of the vital challenges of blockchain networks is the consumption of energy. These dealings consume a massive quantity of energy. It is assessed that every Bitcoin deal consumes 75,000 times additional energy as related to a card transaction.

Other Technological Advancement:-

In modern times human technology is proliferating. For this reason, the blockchain technology also enhances their capability in very quickly. Modern technological tools have the probability of allowing the auditor to analyze and vast volumes of designed and formless data connected to a business’s financial evidence (CGMA 2018). This ability may permit auditors to check 100 percent of a business’s dealings as an alternative of only an example of the inhabitants.

The critical accounting companies have declared that the practice of these tools is increasing the audit by systematizing time-consuming jobs, which are more rote and manual. For instance, over the use of AI, robotic arrangements could interface with a consumer’s structures to compile and transfer data spontaneously, something earlier done by hand through a junior auditor.

The use of these technical tools and techniques increases specific challenges. For instance, the information being used must be dependable, comprehensive, and accurate. That is factual for overall ledger documents, other economic and functioning data, and documents from outside the business. Data quality and security control over these tools, whether established in-house or by retailers, are factors for companies to consider. It is also confirming the reliability of methodologies across group inspections may become problematic if such tools are not willingly accessible to, or used by, associate workplaces (Otete 2018). For these technical tools and techniques to help the relevancy and appropriateness of the audit, they need to be used to improve and distribute a more excellent quality audit to enhance the investor’s benefit.

Future of new technology for audit:-

Innovative technology creates it probable for auditors to analyze vast quantities of a business’s financial data and test 99.9% of a business’s transactions as an alternative to testing only a sample (Zheng et al. 2017). Modern technology allows auditors to make innovative analytics to improve a deeper understanding of the business’s operations. Technological developments might even move accountants near more continuous monitoring and auditing model because they’ll be capable of accessing appropriate customer data and identical format. Noticeably, progressive technologies offer the excessive potential to the audit. But it’s vital to remember that for all the possible AI, data conception, and robotic automation offer, these skills are only as decent as the audit team controlling them and analyzing the outcomes.

Conclusion:-

This assignment is describing the fundamental concept of blockchain technology and also deliver some nice idea about advantage and challenges of this technology in a financial organization. The critical part of this report is that some advance technology must increase any business financial model.  With the help of modern technology, the organization is easily capable of recognizing and reviewing a consumer’s progressions and, using process mining, discover them efficiently. So the conclusion of this report state that recent technology was carrying the most effective audit method, which can enhance the organization’s financial status.

References:-

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CGMA, C., 2018. Blockchain augmented audit–Benefits and challenges for accounting professionals. The Journal of Theoretical Accounting Research, 14(1), pp.117-137.

Kokina, J., Mancha, R. and Pachamanova, D., 2017. Blockchain: Emergent industry adoption and implications for accounting. Journal of Emerging Technologies in Accounting, 14(2), pp.91-100.

Kshetri, N. and Voas, J., 2018. Blockchain-enabled e-voting. IEEE Software, 35(4), pp.95-99.

Otete, A.R., 2018. Audit market dynamics and auditors’ remuneration of listed companies in East Africa. European Journal of Accounting, Auditing and Finance Research, 6(6), pp.12-21.

Produit, B., 2018. Using blockchain technology in distributed storage systems.

Sahlin, E. and Levenby, R., 2018. Blockchain in audit trails: An investigation of how blockchain can help auditors to implement audit trails.

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Sutton, A. and Samavi, R., 2017, October. Blockchain enabled privacy audit logs. In International Semantic Web Conference (pp. 645-660). Springer, Cham.

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Zheng, Z., Xie, S., Dai, H., Chen, X. and Wang, H., 2017, June. An overview of blockchain technology: Architecture, consensus, and future trends. In 2017 IEEE international congress on big data (BigData congress) (pp. 557-564). IEEE.