What you need to know about DAAIET

Jun 30, 2020

Paul Monahan asked the FAE Core examiner to share some thoughts and expectations on the new Topic Area 3 for the upcoming FAE examinations in August. Paul has summarised the examiner's comments across the elements of Topic Area 3 into a useful candidate guide for the exam.

Data Analytics

Paul Monahan (PM): Taking us through the three elements of this new topic area, can you share with us any personal experience you may have of these new areas and what your expectations are for FAE candidates, recognising their more limited practical experience?

FAE Core Examiner (CE): In my own day job as a finance professional leading a large team of finance personnel, we have been using analytics tools for several years. The sheer volume of data created by companies can be viewed by finance as a threat or an asset. We have always chosen to see it as an asset yet, in the past, we have not always been able to exploit the data in any S.M.A.R.T. way. The growth of new technologies in this area are only now really starting to take hold and grow in financial conversations. Very heartening to see Chartered Accountants Ireland leading the way in this.

Moving specifically into data analytics, this element of the topic is nicely balanced with the theoretical supported by the practical element. While we cannot yet examine the practical element, having seen the tools in action (and using them in my own industry), they do copper fasten the lessons from the theoretical aspects of data analytics course.

What is essential to keep in mind is that the possibilities for data analytics are endless and, as an examiner, we can examine data analytics from any number of perspectives. From auditing right through to strategy or payback, data analytics exam indicators are not just limited to explain x, y or z. As in real life, they will play an increasingly important role of recording, analysing and predicting for companies.

Artificial intelligence

PM: Some candidates find artificial intelligence a bit confusing think this falls under the category of 'data analytics'. What's the difference?

CE: The artificial intelligence is interesting insofar as it has been more accessible to us without us perhaps realising so; the machine learning and natural language processing that is integrated into our devices at work and home. The robotic process automation (RPA) element is an exciting element, and I would frame the differences between the two as follows: RPA is operational, whereas analytics is strategic. RPA can mimic and perform human tasks, whereas the analytics tools can sit above them to analyse the output. Both can fit and work seamlessly with each other.  For example, there is no reason why you could not set up an RPA process to perform processing and generate reports that it then, in turn, feeds into a data analytics set of tools.

PM: That is a useful distinction. Interestingly, we created just that sort of flow through as part of some new data analytics, AI and emerging technologies (DAAIET) indicators we created in response to feedback we have received from students on a recent DAAIET Webinar. How do you see exam indicators shaping up in this area?

CE: Candidates need to interpret the conditions presented in the cases to work out if these present an opportunity for an artificial intelligence-led solution. There was a good article written in Accountancy Ireland Extra about artificial intelligence back in March 2020.

Emerging technology

PM: Would you explain to us how you see this part of the Competency Statement (3.3)  being reflected in examination indicators?

CE: What is interesting to see is that blockchain is featuring heavily in certain industries over others, and it will probably continue like that. For example, shipping, logistics, property, finance and banking are all areas where there are active blockchain projects. From an examination perspective, it is not unreasonable to see how a company could interact with a competitor/customer/supplier who is exposed to or is using this technology and, as the candidate, you will be required to demonstrate your understanding to answer whichever direction the indicator goes. I like the fact that the  Competency Statement developers delineated crypto from blockchain and came up with an interesting set of frameworks in both blockchain and cryptocurrency. Being able to use a framework gives candidates a good jumping-off point. It is not unreasonable to see indicators that require the use of those frameworks to help candidates frame their responses.

CE: As a final note, we reviewed the new sample indicators developed in the education delivery programme for topic areas 3.1/3.2 and 3.3. We have based current exam indicators on the novel approaches adopted in these indicators.

PM: Thanks for your time, that has been very useful.