Yeamin Jacky¹ and Noor Adwa Sulaiman^2♣
1Graduate School of Business, Universiti Malaya, Malaysia
²Department of Accounting, Faculty of Business and Economics, Universiti Malaya,
Malaysia

This study examined perceptions of external auditors on the actual use of data analytics (DA) and factors affecting its use in external auditing. Based on survey questionnaire data, results from descriptive analysis showed a lack of use of advanced data analytic tools amongst the respondents. A majority of them agreed that further support was needed when asked about DA usage. DA was perceived by the respondents to be useful in fraud risks evaluation, audit planning and test of journal entries. The respondents also perceived benefits of DA include improvement in audit efficiency and effectiveness, and auditors’ ability to detect material misstatements. A range of factors that included audit profession, technological, organizational, quality control and audit client were perceived to have an effect on the use of DA in external auditing. Analysis of top ten mean scores showed that amongst the attributes affecting DA use in audit practice were reliance on IT specialist, auditors’ skills and knowledge, storing and retaining data for audit trail and quality controls within the use of DA. The findings of this study would be useful for accounting firms and policymakers to assess the motivating and hindering factors affecting the use of DA in external auditing. This study is one of the first that explored the use of DA within the context of external auditing in Malaysia.

Keywords: Data Analytics, External Auditing, Big Data, External Auditors

^♣Corresponding Author: Noor Adwa Sulaiman, Department of Accounting, Faculty of Business and Economics, Universiti Malaya, 50603 Kuala Lumpur, Malaysia.
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