As one of the world’s largest dollar value contributors, the oil and gas industry spends billions on auditing services for fuel stores and fuel brands. A survey taken in 2017 of 161 US public companies, conducted by The Financial Executives Research Foundation, stated that the audit fees averaged $7.4 million, with a median of about $2.8 million. The average per cent increase in the audit fees reported was 6.9% as compared to 2016 to 2017. The median increase was recorded at 1.3%. The oil and gas industry employs hundreds of employees that work efficiently on audit-related services. Sometimes they are hired internally and sometimes leading customer experience companies help them by providing brand audits in the fuel industry or compliance audits in the fuel industry. These large teams deal with specific elements that usually add to the complexity of the audit process in oil and gas companies.

In a case where the government owns the fuel brand fully or partially then the company engages government officials who work through intermediaries for auditing procedures. Therefore, oil and gas companies may get into a contract with national oil companies and form joint ventures together or may also hire third-party engineering, procurement and construction management (EPCM) firms that can help them figure out in-country operations. Moreover, a financial statement audit for oil and gas company producers is required because the entity is a public company or has debt that requires auditing of financial statements. The price of oil also is considered significant when it comes to auditing. When and if the oil price drops cuts are made in the system to stay on the target levels and keep delivering even in these critical times. When this happens the oil and gas company arrives at a situation where the business proceedings do not align themselves with the corporate policies. These types of complexities increase because there are many parties involved with too many operations running at the same time. This directly adds to the risk of basic errors. To avoid such major challenges in the oil and gas industry the industry has collectively come together to change the system by incorporating a combination of new oil and gas technologies that can reduce costs. Some of them are robotic process automation, blockchain, smart contracts, analytics, and AI-ML which are slowly but effectively changing the auditing process in oil and gas industry. This helps them with decreasing costs by a lot and improving reliability. This digital transformation in the oil and gas industry is also necessary because investors request it so persistently for more information and transparency in the system. In fact, this sudden changes in oil and gas industry have pushed auditing firms and customer experience companies to adapt to new techniques in auditing and service offerings.

Given these changes, the technical skills that auditors carry will also need a shift. This is because necessary accounting activities will transform and become digitally managed by bots and AI. Therefore, auditors will need to gain ample knowledge of digital skills like automation, analytics and communication, and data interpretation.

Based on the knowledge we have gathered so far in this blog, these are the digital transformations in the oil and gas industry or technological adaptations that the oil and gas industry is looking at:

1. Blockchain: It is anticipated that blockchain or distributed ledger technology will completely change the way that the oil and gas industry is auditing currently. This is because blockchain technology in oil and gas industry can track and record every transaction made!
2. Smart Contracts: these are contracts that are self-executing. This is possible by writing lines of code in the agreement between the buyer and the seller. This code and the agreements it has will continue to exist within a distributed, decentralized blockchain network.
3. Analytics: Analytics in the oil and gas industry can help build on the efficiency in the operations of the sector. Industry benchmarking and analysis can provide external audits to gather various diagnostic and prescriptive offerings while also predicting behaviour in the system before it occurs.
4. Artificial Intelligence/Machine Learning: AI and ML help in identifying errors in the system during the auditing procedure. It also helps eradicate these errors by continuous internal learning of the process. Along with this, AI also reviews multiple numbers of contracts in relation to Robotic Process Automation (RPA).
5. Robotic Process Automation: Robotic process automation in the oil and gas industry (RPA) is used to extensively imitate manual tasks that can become not only repetitive but also susceptible to errors like gathering data, copy-pasting and cross-referencing data in audits.

Even a traditional business and industry like the one that the fuel industry or the oil and gas industry is, it still needs considerable change to adapt to the demands of the market. This is solely because the consumer needs are changing and the industry must focus on cost-effectivity. With a dynamic space like the fuel industry that requires constant auditing the best way to move forward is to adapt to these digital transformations in the oil and gas industry. Very shortly we will notice that there is considerable change in the auditing process. This change will be required to ensure that the fuel brands and fuel stores are delivering and maintaining the desired results of the brand. The only thing required is a considerable change in the training of the auditors to understand the fresh operating systems.

Our CX solutions are focused on transforming the total customer experience through surveys, metrics, analytics and auditing by using the CXM framework to combine physical measurements with digital Platformation™ capabilities. We are committed to finding the right customer experience strategy that can lead to a competitive advantage.

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