INTHEBLACK September 2021 - Magazine - Page 55
Right: Darlene, an
augmented reality smart
glasses device, was first
exhibited at the Youbiquo
booth during the Mobile
World Congress 2021 in
Barcelona, Spain.
clearly demonstrates the commitments of corporates
to our society,” says Alex Ooi FCPA, executive officer
of the Audit Oversight Board.
There are currently no specific assurance standards
on ESG reporting, with or without virtual reality
technology, says Ooi.
“We always encourage transparency in reporting. If you
just have so-called visual augmented reporting, everything
will just be ‘fluff ’. There must be standards to ensure that
companies report the bad as well as the good.”
Michael Davern CPA, professor of accounting and
business information systems at the University of
Melbourne, agrees that, while the pandemic will result
in an influx of new ideas to the reporting landscape, a
regulatory mandate is essential.
Davern points to the example of the reporting
language, XBRL. It brings powerful search and
information analysis to digital reports, but its use
in Australia is limited because there is no regulation
to enforce it.
He is concerned that AR and VR are solutions in
search of a problem, rather than the other way around.
“I don’t see this as enhancing the dialogue between
investors and management, because the scarce
resource is always the time of management. As a
shareholder, I can’t call the CEO of Wesfarmers and
talk to him about how he’s going to manage things
next year. Is this going to change that? No.”
Davern sees the most likely application of AR and
VR in aspirational and narrative reporting – and most
likely to put a “shiny spin” on what is coming next
rather than provide substantial information.
The UK FRC agrees in its report – AR and VR
work best when used to enhance understanding
of intangible aspects, and for a wider audience
than time or distance usually allow.
A TIME YET TO COME
While we already walk around with augmented reality
devices in our pockets, the technology’s widespread
adoption is still some years away. The FRC concludes
that corporate reporting will fully turn towards AR
and VR in five to 10 years.
“The ability for VR and AR to bridge between
the physical and the digital gives it a useful role
in supporting and building understanding about
a company, its business model and its operations
at a distance and scale,” the report says.
“VR and AR need to overcome several regulatory,
cost and user challenges before they become a key
mechanism for company reporting.”
“IF YOU JUST
HAVE SOCALLED VISUAL
AUGMENTED
REPORTING,
EVERYTHING
WILL JUST
BE ‘FLUFF’.
THERE MUST BE
STANDARDS TO
ENSURE THAT
COMPANIES
REPORT THE
BAD AS WELL
AS THE GOOD.”
ALEX OOI FCPA,
AUDIT OVERSIGHT BOARD
CLICK HERE
TO BORROW
The Routledge
Handbook of
Integrated
Reporting from
the CPA Library
HOW AR AND VR
WILL AFFECT AUDIT
THE MOST PROMISING CROSSOVER BETWEEN
AR AND VR AND AUDIT IS THE SITE VISIT. SITE
VISITS CAN TAKE UP A LOT OF TIME, ARE
EXPENSIVE AND ARE DIFFICULT TO DO WHEN
TRAVEL IS RESTRICTED.
Johnny Lam CPA sees a strong argument for
AR and VR in stocktakes, for example. PwC
Hong Kong may deploy as many as 20 staff on
one project in Mainland China, and it can take
a day of travel simply to get to some of the
more remote factories.
“Maybe, with VR, I can send two staff with a
camera to look at the whole facility and ensure
that what I see in the ‘virtual reality’ is the
same in the real world,” Lam says. Then, his
colleagues could do the stocktake from their
office rather than onsite.
It is a similar story for financial or
operational due diligence. Lam has a client
with a construction site in South Asia, but he
can’t send staff there because of COVID-19
restrictions.
The big question is who controls the camera,
says Professor Michael Davern CPA. “Is there
some assurance or authenticity? Does the
auditor get to ‘drive’ and say, ‘I want to look in
this direction’? Then, how do you protect staff
privacy or not reveal your trade secrets?
“We still need to work out what the
processes are that wrap around these new
technologies, and how you audit and manage
that disclosure.”
Tyler Wise CPA, director of Wise
Accounting, says before auditors jump onto
AR and VR, they could look to other
technologies that have the potential to
improve audit.
“I look forward to blockchain, with
immutable data,” Wise says. “You would know
exactly what is in there, and it can’t be altered.
“As to when AR and VR would be used in
the corporate world, it feels so far away.”
intheblack.com September 2021 55