Deloitte showed off some of its latest technologies for audit, tax, analytics and consulting at its New York offices Thursday.
Among the technologies on display at the Deloitte Innovation Demo Day in the firm’s 30 Rockefeller Plaza offices were ICount, a mobile app for doing inventory counts using a bar code reader that employs the camera on an iPhone or Android phone. The app works with Tableau's data visualization software to plot the information on charts. Approximately 200 of Deloitte’s engagement teams are now using the technology, which is in its second year.
“That’s the beauty of why the technology is so important,” said Deloitte & Touche chief innovation officer Jon Raphael. “Now we’re spending almost no time on data capture, binding, reconciling and creating work papers. All the time is spent interacting with people, touching the inventory and moving things around.”
Another technology for auditors is in the area of disclosure analytics, letting them rapidly search through millions of disclosures and accounting policies among companies. Users can target their searches to look for topics such as cyber disclosures. A blue indicator shows if there was any comment letter from the Securities and Exchange Commission, for example, on the use of non-GAAP metrics. The application employs XBRL (Extensible Business Reporting Language) technology to find patterns. A predictive algorithm gauges levels of accounting risk, business risk and fraud risk for auditors.
“As we think about innovation from Deloitte, our role is to really make sure that we’re taking advantage, both for ourselves and our clients, of the latest technologies that are out there,” said Craig Muraskin, managing director of U.S. innovation at Deloitte. “Innovation is not just technology, but technology is a critical enabler. A couple of the critical domains that we focus on are cognitive or artificial intelligence automation, and also the internet of things, and blockchain, just to name a few. Within that, we focus on some very specialized technologies, whether it’s robotic process automation or workflow automation, machine learning, natural language processing and natural language generation, a whole slew of technologies. The trick is to tie them together as an ensemble. No one of them will solve any problem. When you bring them together and orchestrate them in the appropriate ways with the right user experience, that actually creates a real difference for us and our clients in terms of leveraging technologies.”
Deloitte’s Argus technology relies on natural language processing to sort through data from thousands of documents. Raphael explained how the technology can sort through 100,000 leases, for example, and identify items of interest. That can help companies comply with the new lease accounting standard.
A related product, the Deloitte Document Review Platform, or DDRP, for R&D uses artificial intelligence to imitate human reasoning and speed up the processing of research and development tax credits. It can highlight documents, help users understand what’s in a contract, pull the information into Excel or Tableau, and generate a “heat map” for visualizing the data.
Deloitte’s tax team is using advanced technology for helping companies recover extra taxes they overpaid to states and countries. The firm’s indirect tax analysis and recovery system uses cognitive technologies such as optical character recognition and machine learning to analyze tons of invoice data, shipping information, and taxes paid to help companies file refund claims and avoid overpaying in the future.
“It scores where your underpayments and overpayments are, and identifies the jurisdictions,” said Deloitte Tax partner Karen Warner.
“It ends the cycle of pay and chase,” said Deloitte Tax partner Andy Gold.
Deloitte Tax partners Karen Warner and Andy Gold at Deloitte's Innovation Demo Day event
Another tax system, TP Digital DoX Tax, focuses on transfer pricing and the country-by-country reporting requirements of the Organization for Economic Cooperation and Development’s Base Erosion and Profit Shifting project, also known as OECD BEPS. The system aims to streamline information gathering and reporting for transfer pricing documentation, using surveys to gather data from a company’s partners, along with workflow management. It allows Deloitte and its clients to review the information to make sure it complies with the new international tax regime.
Boris Nemirov, global transfer pricing technology leader at Deloitte, compared the questionnaire to a survey in Cosmopolitan magazine, though it asks for much more detailed documentation from corporate tax departments. “It shows us how they’re responding and how far they are in the questionnaire,” he said.
The country-by-country rules took effect in most OECD countries at the beginning of last year, and in the U.S. at the start of this year.
Deloitte also showed off SEMOSS, Semantic Open Source Software, for analyzing health insurance claims. The technology has an alarming dimension, however, giving insurance claim analysts access to genetic information on patients and allowing them to see whether conditions such as schizophrenia can be traced to their genetic makeup and other patients with similar genes. The technology makes use of open source data that is also available for medical research by scientists at the National Institute of Health and other institutions. It can help insurance companies find more “efficient” treatments for “high-cost” patients.
Deloitte executives said the technology complies with the patient privacy protections in HIPAA (the Health Insurance Portability and Accountability Act) and could be beneficial to patients. But with repeal of the Affordable Care Act all but certain, and the uncertainty over what will be in any replacement legislation, such as the current ban on using pre-existing conditions to deny health insurance coverage, the technology demonstrates the danger of giving companies too much access to analytical information and artificial intelligence.