Accounting and services firm Ernst & Young (EY) is piloting a suite of blockchain audit technologies that enhances the ability to perform an in-depth review of cryptocurrency business transactions.
Called the EY Blockchain Analyzer, the proprietary technology has been developed utilizing experience gained when working with global clients in the US, Europe and Japan including investment funds, exchange platforms, cryptocurrency mining companies and wallet providers. It is designed to support EY audit teams as they perform audits for companies using cryptocurrencies. It will help to lay the foundation for testing of blockchain assets, liabilities, equity and smart contracts as companies adopt blockchain technologies.
The technology will be used by EY audit teams to gather an organization’s entire transaction data from multiple blockchain ledgers. The auditors can then inspect the data and perform analysis of transactions, reconcile and identify transaction outliers. The solution supports testing of multiple cryptocurrencies including bitcoin, ether, Bitcoin Cash, Litecoin, and a number of other crypto-assets managed or traded by exchanges or asset management firms.
Following this initial pilot, EY said it plans to scale up the technology to develop “customized regulatory compliance and reporting nodes.”
“As digital technology continues to advance, we are focused on developing innovative approaches to the audit process and providing confidence and trust to the capital markets,” said Jeanne Boillet, EY Global Assurance Innovation Leader. “As companies are also focusing on how they embed technologies like blockchain into their financial processes, we are innovating the audit to meet their evolving needs and those of investors.”
“Understanding exchanges and cryptocurrencies is the first step in our ability to develop tools to test various blockchain-based business contracts,” said Paul Brody, EY Global Innovation Blockchain Leader. “These technologies lay the foundation for automated audit tests of blockchain assets, liabilities, equities and smart contracts. EY Blockchain Analyzer will be utilized by the auditor to analyze transactions on a blockchain and help provide insight to the finance function.”
Last week, Digital asset management platform Iconomi claimed that it was the first blockchain company to successfully perform a Proof of Solvency (PoS), a form of blockchain audit, on their platform. The company has been blockchain audited and verified by professional services firm Deloitte.
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