Balance Sheet Audit with AI: Transforming Traditional Reviews with Intelligent Automation

Introduction

• Welcome and context setting
• Importance of balance sheet accuracy in financial reporting
• Problems with traditional audit techniques (manual review, time-intensive, error-prone)

Basics Refresher: What is Balance Sheet Audit?

• Objective of balance sheet audit
• Key components to verify:
• Assets: Cash, Receivables, Inventory, Fixed Assets
• Liabilities: Payables, Borrowings, Provisions
• Equity: Capital, Reserves

The Role of AI in Auditing

• Introduction to AI/ML and NLP in finance
• Key AI tools used:
• Document recognition
• Predictive analytics
• NLP for ledger and narration analysis
• Exception detection algorithms
• Real-life examples (Chat GPT, Mind Bridge AI, Data rails, Valid is, etc.)

Live Demo / Workflow of Balance Sheet Audit Using AI

• Uploading trial balance and ledgers
• Extracting key data using AI tools
• Ratio analysis and trend comparisons
• Outlier detection (e.g., unusual cash transactions, abnormal provisioning)
• Example tools:
  – Chat GPT with custom prompts
  – Excel with Power Query + GPT plugins
  – Open source audit tools like Python + Pandas + Lang Chain

Practical Applications and Use Cases

• AI detecting fictitious assets or undervalued liabilities
• Automated aging analysis of receivables/payables
• Flagging mismatches between bank balances and books
• Cross-checking depreciation and provisions with historical trends
• Internal control improvements via AI audit trails

Risks, Limitations & Ethical Considerations

• Dependency on data quality
• AI cannot replace professional judgment
• Bias and audit evidence reliability
• Regulatory concerns

Q&A and Closing

• Open floor for queries
• Feedback collection
• Share AI tools list, sample Excel template, and e-book link
• Invite to next session / advanced course

Add-Ons

• Handout: “Top 10 AI Tools for Auditors”
• Sample Excel audit template with AI formulas
• PDF: “Balance Sheet Audit Using Chat GPT Prompts”