Digital Trust A New Look at an Older Issue

The predominant method of connecting with others to conduct business transactions is now through digital means. In most cases, the actual people connecting don’t know each other and are operating amid a complex web of technologies, many of which they do not understand. As with any business transaction, there must be a degree of trust in order for the transactions to take place successfully. And even for the business to remain viable.

The need for companies to address this situation strategically and operationally has led to the idea of Digital Trust. According to ISACA, “Digital trust is the confidence in the relationship and transactions among providers and consumers within an associated digital ecosystem. This includes the ability of people, organizations, process, information and technology to create and maintain a trustworthy digital world.”

It was stated in a recent ISACA survey (Available at https://www.isaca.org/digital-trust/state-of-digital-trust) that “the top three most important components of digital trust according to the survey respondents are security, data integrity and privacy, but only half (50 percent) of respondents agree that there is sufficient collaboration at their organization among professionals who work in these fields.” At the same time, “85 percent of respondents say that digital trust is extremely or very important to organizations today, and 63 percent say that digital trust is extremely or very relevant to their job role, only 66 percent say that their organization prioritizes digital trust in line with its level of importance.”

Clearly there is work to be done. It is generally agreed that the Directors and C-suite must drive the work. Then it must be carried out by a company wide network of people, including those responsible for security, data integrity and privacy. This in itself cuts across a broad swathe of company activity. But, as always, it’s important to note that digital trust must not be viewed as a technological activity but rather than one that must involve most elements of the organization.

Companies are generally taking the area of digital trust more seriously than in the past. Some take specific measures to measure their level of digital trust maturity, using outside reviews by experts and/or established security-based frameworks.

In this time of digital commerce, few business activities are more important.

Web3 Blockchain is About to Skyrocket.

According to Market Research Future, the value of the Web3 blockchain technology sector will exceed $6 trillion in 2023, and from 2023 to 2030, Web3 will expand at a CAGR of 44.6%.

It’s seems clear where Blockchain is on the hype cycle. We already went through the initial hype. Then for many, the collapse of cyber currencies this year has brought on a trough of disillusionment. However, after that we have in the Gartner Hype Cycle a period of enlightenment, which may be represented by the Web3 phenomenon as well as a host of other emerging applications of Blockchain. Finally, the new technology settles into a period of productivity, when the usefulness of it is established and it is used in a growing and vibrant new field. This also seems to be where Web3 is taking us.

The latest Newsletter from the Blockchain Council, available on linkedin, sets out the future of Web3 in more detail.

Hyperautomation - Is Now the Time to Act?

Hyperautomation is a data-driven approach that organizations are beginning to use to automate as many business and IT processes as possible. It involves orchestrating the use of such technologies as artificial intelligence, machine learning, robotic process automation (RPA) and other advanced technologies. While hyperautomation is gaining attention among IT Executives and companies generally, broad implementation is beyond the reach of many organizations because it involves extensive planning, and collection, verification and structuring vast amounts of data as well as implementing or integrating the technologies that often are new to them such as AI, RPA and ML.

Nevertheless, these hurtles do not mean that planning for hyperautomation should not be undertaken. This would mean mapping out potential processes to be included in the project, identifying data sources and data preparation issues and identifying and evaluating the potential advances technologies to be included.

Such a planning process will be a large undertaking, but since hyperautomation is gaining steam, now is the better time to begin planning for it rather than waiting until it needs to be done under pressure for competitive reasons.

There is much further reading available, including for example, this paper from Deloitte.

Cash-In-Transit Implications for Standards

By David Hardidge, CPA, Technical Director, CPA Australia Centre of Excellence for Digital Transformation

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David provides expert, authoritative leadership on financial reporting and the audit response in the not-for-profit and for-profit sectors. 
He is technical director at an Australian state government Auditor-General’s office and has extensive experience in accounting advisory functions of large accounting firms providing advice, insights and explanations on Australian accounting and International Financial Reporting Standards and external financial reporting requirements for the public and private sectors. David has been promoting the use of digital financial reporting for over 20 years and served on the XBRL International Inc Steering Committee during its early years.  David is a member of the CPA Australia Centre of Excellence for Digital Transformation and was member and chair of the CPA Australia COE for Financial Reporting.
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Is cash-in-transit cash?  No, I do not mean cash in armoured cars in transit around the city. I mean funds in the banking system that are in transit to you and settled after a delay. Do you know the implications of this question may upend decades of accrual accounting for cash in the balance sheet and how you do bank reconciliations?

What Is Cash-In-Transit?

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CPA Founding Partner

Chartered Professional Accountants of Canada (CPA Canada), one of the largest national accounting organizations in the world, has chosen to become a founding partner of ThinkTwenty20.