PwC has reportedly joined hands with Northern Trust-global asset management to start auditing blockchain systems. Audit firms will be able to get their hands on data stored in private equity to examine particular events in real time, according to the website Consultancy.uk.
In February, Northern Trust came out with the news of the commercial application of blockchain technology for private equity. It will allow a few clients to accesses the ownership shares through the DLT- Distributed Ledger Technology.
The Chicago based company is positive about the recent development of technology that allows them to own their blockchain node. It enables them to perform real-time audits as it connects with relevant fund data. Northern Trust informed that the system is based upon the open-source Linux Foundation Hyperledger Fabric. It makes the framework, which uses IBM’s blockchain platform, highly secure for operations.
PwC ushers into the era of blockchain audits
The objective of blockchain audits is to ensure transparency in the subjected transactions by providing a “golden copy” of private equity lifecycle events to the auditors. In an interview with CoinDesk Pete Cherewich, Vice President of the Management group Northern Trust, stated, “We’ve taken and updated a process that was manual and happens periodically, and we’ve enabled that to be done on a daily basis in an automated manner.”
On the other hand, PwC revealed that auditing tool was originally built by Northern Trust and is separate from the new technology of blockchain auditing. It is likely that they would cross paths in the future.
Nick Vermeulen, Partner in PwC, said, “Our ability to directly access distributed ledgers such as the one within the Northern Trust system will allow us to build upon our own blockchain investments.”
PwC has already been working on the blockchain technology extensively. It recently collaborated with Arc Net to launch a food supply chain that uses the blockchain technology to eliminate frauds. One of the Big Four professional services firms, EY, is working with SAP to implement blockchain technology on a global level. Meanwhile, KPMG has been backing up the idea of using distributed ledgers like blockchains to improve security and efficiency of payroll procedures given by Etch.
In 2016, Libra, a New York-based accounting firm was the first company to adopt the technology with the help of PwC. It focused on launching its own enterprise based on instant blockchain audits. Lately, PwC informed about an unnamed auditing tool that was being used by a digital wallet provider and a stock exchange.
PwC looks at Northern Trust’s platform as a fitting part of its larger plans. Northern Trust believes that eventually, auditors will have to embrace the new technology in order to decrease the costs of their jobs. The application is in itself tempting for the creatively minded auditors as they can use it for better and faster results.
As more companies are accepting the inevitable change through blockchain, auditing will have to become more competent. It will be interesting to watch the stance of other VC firms in response to the Big Four.
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