PwC Tells PCAOB to Make AI in Audit Its “Foremost Priority”
The firm is urging the US audit regulator to issue guidance on AI, identifying risks ranging from automation bias and unreliable audit evidence to the use of tools such as ChatGPT in audit work
PwC has urged the Public Company Accounting Oversight Board to make the use of artificial intelligence by companies and auditors its “foremost priority”, arguing that the regulator should provide guidance in the near term on how its existing auditing standards apply as AI becomes increasingly embedded in audit work.
In an August 5 comment letter responding to the PCAOB’s consultation on its future standard-setting agenda, PwC said the regulator should initially focus on guidance rather than attempting immediately to write detailed new rules for a technology that is changing rapidly.
PwC also recommended that the PCAOB establish an AI task force, deepen its engagement with audit firms and draw on its inspection teams. The firm said guidance should address concerns including data bias, explainability and automation bias, together with questions around model training, traceability and whether AI-generated work can be reconstructed.
The firm argued that humans should ultimately remain responsible for judgments including risk assessments, the sufficiency of audit evidence, contradictory information and the final audit conclusion.
PwC is not alone in pressing the issue. The regulatory question is becoming crucial as major firms invest heavily in bringing AI into their audit processes. Bloomberg Law reported Wednesday that both auditors and investors are now pushing the PCAOB to move faster in explaining how its existing standards should be applied to AI-enabled audit work.
Long-established concepts such as audit evidence, professional scepticism, supervision, documentation and human accountability now have to be reconsidered in a world where increasingly significant parts of the audit process are performed or assisted by AI.
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