High vouching accuracy of 94% confirmed in a pilot test with PricewaterhouseCoopers Aarata LLC
Genial Technology (https://www.genialtech.io/) announced approximately 60 million yen in funding from Incubate Fund today. In addition, the company was able to automate vouching procedures in interim sales tests and achieved an accuracy rate of around 94% in a pilot test with PricewaterhouseCoopers Aarata LLC. Genial Technology will use the funding to further accelerate the development of products for audit firms.
Against a backdrop of strong demand for compliance and transparency in listed companies’ disclosure, expectations from the auditor and the financial statement audit are increasing. However, the audit process still involves manual work by reading paper-based documents and handling a vast volume of materials.
In particular, vouching (the procedure of verifying facts and records by checking transactional records against other documents that serve as evidence) plays a vital role in the total audit procedure. The automation of the vouching process has the potential to drive significant efficiency of the entire audit process.
■ Features of GenialAI
Genial Technology offers Genial AI, a self-learning audit tool that automates vouching, with the mission of "AI for more effective auditing" to reduce the burden on the auditors and allow them to focus on tasks that require human ingenuity and judgment.
While there has been some progress in the development of tools to improve operational efficiency in the audit through the use of technology, the majority of these tools currently rely only on visual checks. Using AI-OCR, GenialAI can read purchase orders, shipping documents, invoices, and other documents that are the basis of accounting records, and automatically match them with sales and other data, thereby automating vouching procedures.
Genial Technology is developing a product that will greatly automate audit operations, taking advantage of CEO Aki Abekawa's background as CPA, Systems Auditor (Japanese government’s certificate), and Engineer.
■ Results of the Pilot Test
As a result of the pilot test conducted with PricewaterhouseCoopers Aarata LLC regarding vouching for interim sales tests, an accuracy rate reached approximately 94%. Specifically, reperformance of vouching procedures using Genial AI achieved that the test results for 3,226 out of a total of 3,433 statement lines / test items were the same as done by auditors visually examining paper-based documents and records. This confirms that the accuracy of AI-OCR and reconciliation are a powerful tool to raise the efficiency of the auditing process.
■ Future Outlook
In addition to the currently released web application, we are developing an Excel add-in, and aim to introduce it on a global scale at major accounting firms. For companies, we are also developing a suite of RPA tools that can significantly improve operational efficiency in various use cases where routine data entry and reconciliation are performed manually.
■ Comments from investors participating in this round
General Partner, Incubate Fund
Mr. Paul McInerney
I am delighted to support CEO Aki Abekawa’s vision for AI-empowered auditing. Financial auditing is a $120 billion global market that has immense potential for the use of AI - I look forward to working with the GenialAI team to bring their platform to the world’s audit leaders and launch a global SaaS powerhouse from Japan.
■ Overview of investors participating in this round
Incubate Fund https://incubatefund.com/
Incubate Fund is an independent venture capital firm that specializes in investing in and nurturing startups under the motto, "We will honestly support the challenges of aspiring entrepreneurs.” It has the largest track record of investment in seed startups in Japan. As a good partner to entrepreneurs, it strives to create new businesses, launch venture businesses, and increase their value from the closest position.
■ Overview of Genial Technology
Company name: K.K. Genial Technology
Established: July 1, 2019
Location: 3F Sunny Plaza Hiratsuka, 8-16 Beniya-cho, Hiratsuka, Kanagawa, Japan
Representative: Aki Abekawa