Deloitte applies professional audit standards to blockchain transactions

Source: Deloitte

Deloitte today announced the completion of a blockchain project which was designed to demonstrate tangible and actionable options for assurance related to blockchain transaction data and infrastructure.

The goal of the project was to enhance the utility and trust of a permissioned blockchain system by applying professional audit and assurance standards to scrutinize blockchain protocols and applications.

Deloitte has broad blockchain technology offerings worldwide, including providing advisory services to building decentralized applications (Dapps) on multiple blockchain platforms for clients across many industries. Deloitte has made significant investments in growing and developing blockchain-focused capabilities to advise clients as they explore their own blockchain-based transformations, including opening a blockchain lab in New York City earlier this month.

"As this technology evolves, it's only a matter of time until our clients tell us they are moving portions of their business onto blockchain infrastructure, said Will Bible, partner, Deloitte & Touche LLP. "Moreover, as a leader in delivering audits of the highest quality, we need to get ahead of the curve on quantifying and defining how an auditor could provide a level of assurance on a permissioned blockchain application, contributing to the trust and confidence in the network. For this project we tapped into the breadth and depth of experience within our multidisciplinary business model to collaborate across our audit, technology, and blockchain groups to pull together the experience needed to apply the lens of assurance on blockchain-based applications."

"For the purposes of this project, we selected an internally-developed loyalty points blockchain application built by our Rubix by Deloitte team on a permissioned ethereum network as a test case," said Iliana Oris Valiente,

Deloitte Canada, co-founder and strategy leader of the Rubix by Deloitte team. "Although each client engagement is unique from a technology and a business model perspective, there are many similarities among the processes in designing, building, and operating a blockchain-based product," she added.

The Deloitte team applied existing guidance from attestation standards to the permissioned blockchain application to understand the options and challenges for this project. They also developed procedures that are specific to the nuances of a blockchain product. The procedures developed, and assurance options explored, could benefit blockchain principals, preparers and users of financial statements, as well as auditors.

Tim Davis, principal, Deloitte & Touche LLP, noted, "Given the early stages of blockchain maturity, we recognize that many clients are in the development phases rather than in production. As this technology matures, participants of these blockchain solutions are going to need to understand the potential risks and be able to provide the proper assurance that the processing environment and data is managed in a well-controlled manner.

Deloitte is well-prepared to provide advisory and assurance services for organizations that are looking to build trust and confidence in their blockchain service delivery processes and controls," Davis added.

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