The Challenges of Applying Regulatory Technologies (Regtechs) in the Role of an Auditor

Document Type : Research Paper

Authors

1 Associate Prof., Department of Accounting, Faculty of Economics and Administrative Sciences, University of Qom, Qom, Iran

2 Master of Sciene in Accounting, Faculty of Economics and Administrative Sciences, University of Qom, Qom, Iran

Abstract

Recent technological advancements have significantly impacted the auditing industry. Regulators have used technology to enhance auditing effectiveness and oversight. Regulatory technologies (RegTech) have been developed to address these regulatory needs and improve oversight capabilities. RegTech, a subset of financial technology, has been designed to facilitate efficient and cost-effective compliance with regulations, thereby improving regulatory processes. RegTech businesses can play the role of an auditors. This research aims to identify and rank the challenges associated with employing RegTech in the role of an auditor. This research employed a judgmental sampling method. The experts consisted of 14 senior managers and specialists from the Auditing Organization, the Central Bank, the Fintech Association, the National Information Technology Company, and university professors. Through a literature review and expert interviews, 18 challenges were extracted. In the first stage, a fuzzy Delphi questionnaire was used to screen the challenges. Subsequently, the screened challenges were ranked using a priority assessment questionnaire and the Mabak decision-making method. In the first stage, 11 challenges with a threshold greater than 0.7 were selected as the main challenges. The ranking of the main challenges revealed that challenges related to accountability, the regulatory gap between the actual conditions of digital businesses and auditing standards, recruitment and retention of RegTech specialists, inadequate equipping of companies' accounting information systems with new digital technologies, and the lack of trust of audit report recipients in RegTech were the key challenges. Identifying these challenges will pave the way for the development of technology-based auditing.

Keywords

Main Subjects

References

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Journal of Accounting Advances
Volume 17, Issue 1
September 2025
Pages 149-183

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History

  • Receive Date: 13 November 2024
  • Revise Date: 31 August 2025
  • Accept Date: 08 September 2025

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