KPMG announces AI integration into global smart audit platform, KPMG Clara

• 90,000 auditors globally will be using KPMG Clara AI 
• New AI capabilities live within KPMG Clara, interacting directly with audit engagement documentation and our audit methodology
  
• Capabilities across the full audit process aim to enhance quality and the audit experience
  
• KPMG Clara AI is supported by our Trusted AI framework that emphasizes a human-in-the-loop mindset to help ensure quality and accuracy
  

New York, July 29, 2024 – Today, KPMG International and the KPMG network of member firms providing audit, tax and advisory services, announced the integration of generative AI into KPMG Clara, our global smart audit platform. 

64% of companies expect auditors to have a role in evaluating their use of AI in financial reporting, providing assurance and attestation over their AI controls.

KPMG Clara AI is connected to our broader transformation efforts to enhance audit quality through our Trusted AI framework. For example, new generative AI capabilities will help teams:

• Refine risk assessments: AI assistants can review documents to help engagement teams identify risk factors. For instance, within KPMG Clara, engagement teams can leverage AI to help review meeting minutes and flag possible accounting and financial risks.
• Develop substantive testing procedures: Our AI assistant has direct access to KPMG audit methodology, enabling auditors to design appropriate substantive testing procedures to respond to risks quicker.
• Enhance audit documentation: By working with our AI assistant, team members can quickly summarize, question and consider improvements to engagement-specific audit documentation within KPMG Clara.

KPMG today also unveiled AI and generative AI capabilities that will be deployed in the workflow in the coming months. These include:

• A growing prompt library that will, over time, include AI-powered agents to assist Audit teams in driving audit quality;
• Automated quality scoring to generate AI assessments and deliver feedback to Audit teams on actions for quality improvement;
• Use of AI and machine-learning to automate the review of financial statements, augmenting engagement teams’ assessment that all required disclosures have been made to the capital markets; and
• Assurance capabilities integrated into the workflow for teams delivering assurance over disclosures, for example emissions disclosures. 

By infusing AI through KPMG Clara, KPMG firms’ 90,000 Audit professionals globally will be empowered to focus more closely on higher-risk areas of the audit, sector-specific risks and challenges — with the goal of benefitting both stakeholders and capital markets.

The capabilities announced today build on recent milestones in our journey to deliver an AI-enabled and people-powered audit, including: 

• In June 2024, KPMG released the AI in financial reporting and audit: Navigating the new era study, looking at financial reporting leaders’ AI expectations for their companies and external auditors.
• In April 2024, KPMG firms began deploying Copilot for Microsoft 365 to Audit partners and professionals. Engagement teams are already leveraging Copilot, along with Audit Chat, to transform the walkthrough experience by generating process narratives and flowcharts based on meetings with clients.
• In 2023, KPMG penned a multi-year global audit alliance with MindBridge, embedding its AI and machine learning capabilities into KPMG Clara in the form of Transaction Scoring. With KPMG Clara AI Transaction Scoring, auditors can perform analyses over 100% of transactional populations, delivering audit evidence and identifying outliers over both general ledger and subledger populations.
• In 2023, KPMG also announced a multi-year, multi-billion-dollar investment in Microsoft’s AI and cloud services. Through this expanded alliance relationship, KPMG firms will infuse data analytics underpinned by Microsoft Fabric and generative AI through the Azure OpenAI Service and Azure Cognitive Services into the audit process. 

To learn more about KPMG Clara and our Trusted AI capabilities, visit kpmg.com/trustedAI or kpmg.com/kpmgclara