Accountancy & Management: Auditor as cybernaut: Virtual reality could transform work, says Philip Cahill

AUDITORS travel to clients' premises. There they collect and record information. But it is possible that in the not-too-distant future they could be saved the journey - through these activities taking place in the mind's eye of a computer.

The vehicle is virtual reality, the increasingly widespread technology that can be described as a method of placing users 'inside' a computer program.

In the financial world, computers have been used for a long time to produce financial statements and to record and control information within accounting systems. Auditing is essentially the verification of such information. VR technology allows the creation of a virtual world, an electronic 'cyberspace domain', that will allow the auditor instantaneous access to accounting data and to an advanced form of videoconferencing known as telepresence.

Methods of fabricating virtual worlds are in the early stages of development. The types of system available to users can be split into immersive and non-immersive systems.

In a typical immersive VR system the user wears a headset that contains two tiny computer screens, one for each eye. The screens are designed to give the illusion of three-dimensional vision. In addition, aural information may be given by headphones and tactile information provided by special clothing. A proposed refinement to the headset is the use of low-powered lasers to project information directly onto the retina of the user.

Non-immersive systems use conventional PC screens and some of these systems offer the illusion of 3-D if special glasses are worn.

Many auditors might question the need to abandon their traditional methods to become cybernauts. But it is likely that many business enterprises will wish to take advantage of VR, and it has even been suggested that new types of organisation may be created by the technology.

It may be possible to create effective organisations that exist electronically. Employees could then telecommute from anywhere in the world to the electronic workplace. This would result in big cost savings and flexible work patterns.

Such organisations would need electronic auditors. And auditing around the computer - that is, pretending it is not there - would no longer be possible. But even electronic commuting or telepresence could prove to be a valuable tool for the auditor.

Much audit work, particularly at manager or partner level, involves highly paid people spending large amounts of unproductive time travelling. Telepresence could allow client staff and audit staff to meet at a moment's notice unconstrained by physical distance.

In addition, new ways of evaluating audit test data and investigating the workings of accounting systems may become possible. In most conventional computerised accounting systems data are in effect invisible while being processed and there are often defects in the audit trail provided.

It is well established that the use of graphics can enhance perceptions of data. In an immersive VR system the user's whole field of vision can be filled with advanced graphical representations of data. For example, an accounting system could be represented as a data landscape that changes dynamically in real time as transactions are processed by the system.

This is not as bizarre as it sounds. Staff at the Tokyo Electric Power Company use a VR system to allow them to fly over a data landscape representing information flows around a power station control-room. The system is used to optimise control-room design.

It is possible that the visual representation of the data landscape could be enhanced by the addition of audio and tactile information. In the defence industry companies on both sides of the Atlantic have spent several years developing methods of delivering information to fighter pilots.

In such a non-immersive system visual information is projected into the pilot's line of sight, aural information is presented via headphones and tactile information is presented via control surfaces. The ability of fighter pilots to absorb information is thereby enhanced. It is likely that the ability of auditors to absorb information could be enhanced in the same way.

However, as well as absorbing information, the auditor must probe into data structures and perform precise calculations. Developments of VR in the field of surgery may be adapted to help the auditor to locate and extract audit test data.

British Telecommunications, in conjunction with a team at Sheffield University and Ipswich Hospital, has developed a prototype VR system to allow the teletransportation of medical expertise.

The idea is that while one doctor is actually operating on a patient, other doctors could assist or supervise via communication links.

Exactly the same type of system could be used by audit managers to guide junior staff around a complex accounting system such as those used by solicitors or insurance companies.

It is unlikely that auditing even at its most complex can approach the difficulty of piloting a fighter aircraft or the precision of surgery. Whatever the manifestation of the mature technology no audit firm's strategic plan should ignore it.

The author is a senior lecturer in accounting at Portsmouth University.

(Photograph omitted)