Digital auditing is becoming an inevitable trend as corporate financial data becomes increasingly complex and massive. Combining solid professional standards with advanced data analytics tools not only verifies the accuracy of figures but also provides insightful perspectives on a company's financial health. In this article, we will delve into the digital auditing process, focusing on VSA 540 and the latest legal updates for 2025.
Understanding digital auditing correctly in the era of Industry 4.0.
In the context of rapid digital transformation, digital auditing is no longer a foreign concept but has become a strategic tool for auditing firms and internal control departments. Essentially, digital auditing involves applying computer algorithms and automation processes to review financial data on a large scale.
The role of digital auditing is clearly demonstrated by strengthening investor confidence through minimizing fraud risks. Instead of probabilistic sampling testing like traditional methods, which have a certain delay and error rate, digital auditing allows for the analysis of entire data populations in a short period of time.
However, it should be emphasized that digital auditing does not replace existing auditing standards. On the contrary, it is an extension that helps auditors perform standard-based checks more accurately and objectively. This ensures that financial statements always truthfully and fairly reflect the business situation of the entity in accordance with the Vietnamese auditing standards system.
Auditing accounting estimates and the role of professional judgment according to VSA 540
According to Vietnamese Auditing Standard 540 (VSA 540), accounting estimates are often the areas with the highest risk of material misstatement due to their inherent uncertainty. Financial figures are not always absolute numbers readily available from invoices; many items depend entirely on management's assumptions.
Common types of accounting estimates that businesses need to pay particular attention to include:
- Provisions for doubtful receivables are based on an analysis of the aging of the debt and the customer's ability to pay.
- Depreciation costs of fixed assets are based on their estimated useful life.
- Measuring the fair value of financial instruments or investment properties in volatile market conditions.
In the digital audit process, auditors use historical data to assess the reasonableness of these estimates. The role of professional judgment becomes extremely important at this point. Auditors must evaluate whether the economic assumptions made by the company are overly optimistic or biased in order to artificially improve the financial statements. Technology helps to cross-reference forecasting models with reality, but it is ultimately humans who make the final decision on the reasonableness of the figures.
Connecting audit objectives between VSA 540 and VSA 700 in a digital environment.
The ultimate goal of any audit is to express an opinion on the financial statements. The connection between examining specific numbers and the overall report is illustrated by the relationship between VSA 540 and VSA 700.
Below is a comparison table highlighting key aspects of combining these two standards in a digital auditing environment:
| Aspect | Audit Estimates (VSA 540) | Audit opinion (VSA 700) |
|---|---|---|
| Focus | The reasonableness of each assumption and estimate. | Overall integrity of the entire financial report. |
| Digital tools | Regression model, analysis of trends in historical data. | Data reconciliation dashboard system |
| Result | Identifying errors in provisions and fair value | Specify the type of audit opinion (Fully Accepted, Exceptionally Accepted, etc.). |
Note: Material misstatements in accounting estimates, if not corrected, will directly lead to a change in the audit opinion on the final financial statements. Therefore, digital auditing helps to seamlessly connect detailed data from the ledger to the consolidated report, enabling auditors to present key audit matters more convincingly.
Applying Data Analytics and AI in Digital Auditing
Currently, following the direction of the Vietnam Association of Certified Public Accountants (VACPA), the modernization of auditing processes is being accelerated through data analytics and artificial intelligence (AI).
The application of technology in digital auditing offers the following outstanding benefits:
- Using Data Analytics to scan 100%'s transactions throughout the year helps to immediately detect unusual entries or duplicate transactions that are easily overlooked by the naked eye.
- AI applications in automating the reading and classification of electronic documents and invoices help minimize manual data entry time.
- Conduct an analysis of the relationships between financial and non-financial variables to predict fraud risk.
According to guidelines from international organizations (such as ISCA's AGS 13), human-machine collaboration is key to success. AI has the ability to process at high speed, but auditors possess the professional ethics and strategic thinking skills to address situations that arise beyond algorithmic capabilities.
Updated legal framework for auditing and accounting in 2025.
The year 2025 marks a legal turning point with stricter regulations aimed at enhancing corporate accountability. Understanding these regulations is a prerequisite for conducting digital audits in accordance with the law.
Circular 99/2025/TT-BTC introduced fundamental changes to the corporate accounting system, requiring greater transparency in explaining estimation methods. In addition, penalties for violations were also tightened.
Here is a summary of some notable penalties under the new regulations:
| Violation | Regulations on penalties (Decree 228/2025/ND-CP) |
|---|---|
| Falsifying or inflating accounting data, but not to the extent of criminal prosecution. | A fine of 40 to 60 million VND will be imposed, and the report will be canceled. |
| Failure to use the correct estimation method according to VSA 540 standard. | A fine of 20 to 30 million VND will be imposed. |
| Late submission of audit reports as required. | Fines will be imposed depending on the number of days of late payment, with a maximum of 50 million VND. |
Note: The above penalties are quoted based on the latest government regulations aimed at deterring non-transparent financial reporting practices (Source: Law Library).
Challenges and potential risks in the digital auditing process.
Despite its many benefits, digital auditing also faces numerous challenges. One of the biggest risks is the subjective bias of management. When estimation models become complex, management may use algorithmic "black boxes" to conceal losses or inflate profits.
In addition, businesses also face the following problems:
- Information security risks arise when sensitive data is fed into third-party analytics software.
- The risk is that auditors place too much trust in computer results (automation bias) and forget the necessary professional skepticism.
- There is a shortage of high-quality personnel who are both proficient in accounting and skilled in data mining.
Optimizing the digital audit process for businesses.
To adapt to the era of digital auditing, businesses need a comprehensive transformation strategy. This starts with establishing a "tone at the top"—meaning that leadership must take the lead in prioritizing data accuracy.
The specific solution steps include:
- Establish robust internal control systems for accounting estimate approval processes.
- Invest in clean data infrastructure to ensure that the input for digital audit tools is always accurate.
- Standardize accounting software systems according to modern data connectivity standards.
- Regularly train the accounting team on the latest regulations in Circular 99/2025/TT-BTC and Decree 228/2025/ND-CP.
Frequently Asked Questions about Digital Auditing
Is digital auditing a mandatory requirement under current law? Currently, the law does not mandate all businesses to use digital auditing technology, but compliance with standards for data accuracy (such as VSA 540) and regulations in Decree 228/2025/ND-CP makes the application of technology the most optimal solution to avoid errors and penalties.
What is the biggest difference between digital auditing and traditional auditing? The difference lies in the scale of the data and the speed of processing. Digital auditing examines the entire dataset instead of a sample, allowing for near real-time error detection and minimizing human subjectivity.
Why has the VSA 540 standard become the focus of attention today? Because in a volatile economy, estimates of provisions and asset values frequently change. VSA 540 provides a framework to control this change, preventing companies from exploiting estimates to manipulate profits.
Conclusion on the future of digital auditing
Digital auditing is not just a technological trend, but an inevitable evolution of the finance and accounting industry. Mastering standards like VSA 540 and VSA 700, along with staying up-to-date on legal documents such as Decree 228/2025/ND-CP, will help businesses not only comply but also enhance their reputation in the market. The combination of human intelligence and the power of data will be a solid foundation for financial transparency in the future.
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Content production by: Mr. Le Hoang Tuyen – Founder & CEO MAN – Master Accountant Network, Vietnamese CPA Auditor with over 30 years of experience in Accounting, Auditing and Financial Consulting.
