PwC’s research is the latest evidence to suggest that now is the time to start blockchain projects or risk falling behind competitors that transform their operations with distributed digital ledger technology.

Blockchain has gained more traction than it might appear. That’s the top takeaway from a new PwC report, whose most telling statistic is that 49 percent of global healthcare companies are already undertaking blockchain initiatives.

WHY IT MATTERS

That finding might be something of a surprise, but PwC is not alone in saying that blockchain is coming and hospitals and systems need to prepare now.

Earlier this year, in fact, both Gartner and IDC shared their own advice about blockchain. Gartner noted that CIOs should consider blockchain or risk being left behind by competitors that move first. IDC recommended beginning by accounting for the pros and cons, pushing for blockchain interoperability among providers and patients and deciding whether to use a public blockchain or opt to keep it private.

THE BIGGER TREND

In the PwC report, A Prescription for Blockchain and Healthcare: Reinvent or be Reinvented, researchers said the 49 percent of the global 74 healthcare companies it contacted includes those developing, implementing or piloting blockchain projects.

Back in May, Deloitte proclaimed that despite skepticism concerning scalability, security and sustainability, blockchain is gaining traction.

Chilmark Research analysts, meanwhile, pointed to blockchain’s potential as “transformational infrastructure” for sharing data, improving quality, even enhancing data privacy.

Blockchain, of course, still has plenty of major challenges.

PwC found that 61 percent of respondents said lack of blockchain expertise is holding them back, 47 percent cited lack of trust as a barrier, 39 percent said the same of regulatory uncertainty, 37 percent consider an inability to bring the network together as problematic.

What’s more, 36 percent listed blockchain interoperability and 33 percent said the inability to scale are inhibitors – while “31 percent told PwC that cast was the primary reason their organization had not progressed further with blockchain.”

ON THE RECORD

“Blockchain-based technologies offer substantial opportunities to reinvent how healthcare companies access, collect, distribute, share, leverage, monitor and audit data,” according to the PwC report.

That’s the upside. An underlying reality also exists that healthcare organizations waiting to move on blockchain may find themselves too far behind to catch up easily.

“Not all companies will benefit,” researchers wrote. “Middlemen may become obsolete. Companies that are slow to change may lose out to ones that use the technology to cut costs and increase efficiencies.”

OUR TAKE

With Deloitte, IDC, Gartner, Chilmark and others making similar assertions, PwC’s report is further proof that blockchain is much more than just hype. If your hospital or health system is in a state of blockchain inertia, now would be a good time to snap out of it.

At the very least, get an understanding of the potential use cases: Read about how distributed ledger can help with the pharmacy supply chain and the ongoing patient matching problem, to name just two. And then determine when, where and how to invest in blockchain. Or for a bit of fun check out our Mad Libs for blockchain: Fill in the blanks now to avoid mistakes before it’s too late.

*This post is credited to HealthCare IT News

Blockchain continues to be the hot topic in the global startup ecosystem. And, more entrepreneurs are placing huge bets on this technology. However, this is not the same case in a few countries. According to a study released by auditing firm PricewaterhouseCoopers (PwC), trust is one the biggest blockers to the blockchain’s adoption. Concern about trust among respondents in the survey was highest in Singapore (37%).

Despite numerous trust issues, there are no stopping companies from using this technology. We asked the founders of blockchain startups in Singapore how they are harnessing the power of this technology for good.

Analyze the Applicability of Technology

Singapore-based LALA World chief executive officer and founder, Sankalp Shangari, feels blockchain technology is not just bringing in a difference at the consumer level instead it is posing a threat to the established system of governance, which is obtrusive of financial freedom.

“A lot of myths are floating around the technology. It was dubbed as a dubious technology, which may look promising, but was porous and could be compromised. The reality is far from it; the technology is secure and reliable than any of the other techniques available. But at the same time, it is complex and in a nascent stage just like the web was in the early 90’s and that is what helps the naysayers in spreading heresy about it. The need is to understand its applicability to a particular problem and the impact it has in solving it,” said Shangari.

LALA ID, a product of LALA World, is a comprehensive solution that protects the personal information of the users through the immutable blockchain technology. Additionally, the startup offers features like crypto payments through its application.

“The world is going gung-ho about the possibilities of the said technology, which is gradually growing as an infrastructural pillar of economic functionalities, receiving the attention it deserves,” added Shangari.

Mapping Unequal Data Sources

Founded by Mike Davie, Quadrant Protocol leverages blockchain and smart contracts to track the data’s journey along the data chain–from the originating device to the data scientists that add value to the data–and provide automatic compensation every time the data is purchased. This helps create a more sustainable data economy. The startup serves as the blueprint that provides an organized system for the utilization of decentralized data.

“Data quality is vital to the success of Artificial Intelligence. Algorithms will believe whatever the data tells them to believe, so using poor quality data can result in unintended consequences. Data consumers, therefore, need to know where the data is coming from and be able to trust the source. At the same time, the original providers of the data are rarely compensated fairly.  Data consumers like data scientists or AI practitioners can be assured of the quality and provenance of the data being purchased, while providers are compensated fairly. All compensation is paid in Quadrant Protocol tokens, which are recorded on the blockchain,” said Davie.

Easing Insurance Agreements

Insurtech company Hearti is serving insurers with their proprietary artificial intelligence (AI) and blockchain platform.

Keith Lim, chief executive officer, Hearti believes blockchain’s immutable nature can foster trust in the insurance agreements between consumers, insurers, and partners.

“Smart contracts are executed based on events that trigger conditions within the agreement (for eg. to pay out claims in the event of a flight delay). When claims data is shared securely on the blockchain, duplicate claims and fraud can be tracked and detected. Such uses of blockchain create huge value for our company’s proposition and put it at the forefront of the industry,” he said.

Founded in June 2015, Hearti Lab was born out of the realization that there was a void in the corporate and personal insurance sector: the lack of a low-cost, full-featured A.I. platform for insurance management. To achieve its vision of developing an integrated insurance platform, the startup has developed two complementary platforms: BENEFIT.X & SURETY.AI.

Building Trust In Technology

For Joseph Lee, chief technology officer, BridgeX Network, blockchain is the “New Technology of Trust”. He believes that blockchain related technologies will spur new ways for the global economy to work.

“Perhaps due to the newness of the tech, there may still be a trust deficit with the general public. We are using blockchain technologies to create a platform to allow lenders and borrowers to transact directly, in a secure, trusted, and protected environment. The terms are specified in the blockchain and will be executed automatically without bias. There is no longer a need for centralized entities to stand in between the borrowers and lenders. The costs saved from eliminating intermediaries are passed to the participants on the platform,” said Lee

BridgeX Network is a financial ecosystem framework, built on a proprietary technology core, that bridges the worlds of cryptocurrencies and fiat. The startup provides decentralised credit, conversion and payment solutions between crypto and fiat currencies, allowing unprecedented interoperability. These create a unifying platform for both fintech-blockchain and traditional financial companies to participate in this new economy.

*This post is credited to Entrepreneur

PricewaterhouseCoopers is developing blockchain technology to help clients validate transactions as they deal with possible risks.

The past spring, PwC debuted a Blockchain Validation Solution to help authenticate transactions for clients. “We are doing the validation of the transactions, so we will do it as an operational service in a non-audit client,” said Vicki Huff Eckert, global and U.S. new ventures leader at PwC. “We will not do it as part of our traditional attest external audit business. The validation tool is really about the operational audit, the entire control framework around it, and how companies gain comfort with the transactions that are processed versus the actual financial validation and external audit of financial statements.”

Blockchain has been spreading beyond cryptocurrencies like bitcoin and ethereum to other applications for distributed ledger technology. Earlier this year, PwC surveyed 600 executives in 15 territories and found that 84 percent said their organizations have at least some involvement with blockchain technology. More than half the respondents reported blockchain research and development in progress, and 15 percent indicated they have live implementations.

PwC has published a white paper on blockchain governance describing Blockchain Risk and Control Framework to help companies identify risks before implementation begins and develop an audit trail for blockchain. The firm’s clients are using the Blockchain Validation Solution for purposes such as legal risk management and internal audits.

“It’s those teams that are trying to gain comfort around the activity that’s occurring on their proof of concepts, and we’re working with them on how they do it, using the tool and using the framework,” said Huff Eckert. “It’s a rules engine, so what we do is we will work with the company as they set up their blockchain environment. The scope is for permissioned exchanges, and we’ll set up a rules engine. We actually put a note on the blockchain to validate the transactions that are being recorded, so they will validate it based upon the rules to test to.”

For example, if four or five companies are supposed to be part of a particular blockchain environment for some type of digital asset, PwC will validate that the transaction is going to one of the five within that permissioned network. “We will actually put into the rules engine how to make sure that the company processing on there is in fact one of the approved companies, and that the transaction in fact has the same operational metrics, so it’s a real-time audit tool,” said Huff Eckert.

The firm sees blockchain as one of eight essential emerging technologies, including artificial intelligence, augmented reality, drones, internet of things, robotics, virtual reality and 3-D printing, with important implications for businesses today.

“We look at all eight of those as a team in my group and we are constantly thinking about how do they impact everything from audit to tax to our consulting business, and how are we leveraging those emerging technologies in what we do but also in how we’re engaging with clients,” said Huff Eckert. “We will think about how to use drones, as an example, in looking at inventories, or how to use augmented reality in training individuals.”

Blockchain with its distributed ledger technology has particular implications for accountants. “The concept of decentralized ledgers is something that I think is extremely disruptive, both opportunistically as well as challenging to the accounting industry, but I do think it’s something you’ll see more of,” said Huff Eckert. “What’s happening in the cryptocurrency space is really the digitization of financial markets, and the pace at which that occurs or does not occur will be also disruptive, not just in using new technology. But the ripple effect will be significant, so that’s why we’re watching it closely.”

*This post is credited to AccountingToday

Blockchain proponents say the technology’s decentralized nature is one of its biggest strengths — but lack of trust among users is posing a hurdle for its adoption in healthcare, according to a PwC report.

In recent years, industry and government stakeholders have supported efforts to use blockchain, a permanent ledger of online transactions or exchanges, to streamline healthcare operations. Unlike a traditional database that is centrally located and maintained by one party, a blockchain record is shared among a network of users.

To assess the largest hurdles for blockchain adoption in healthcare, PwC drew insights from its global blockchain survey, which polled 600 business executives worldwide from April to May on their attitudes toward the technology. The poll included respondents from 74 healthcare companies, including providers, payers and pharmaceutical companies.

Here are the five challenges respondents from healthcare companies most frequently cited as barriers to blockchain adoption in the next three to five years:

1. Lack of trust amongst potential users: 47 percent

2. Regulatory uncertainty: 39 percent

3. Ability to bring the network together: 37 percent

4. Blockchain interoperability: 36 percent

5. Inability to scale: 33 percent

*This post is credited to BeckersHospitalReview

In the world of accounting audits and financial assurance, only the Big Four matter. Deloitte, EY, PwC, and KPMG are the masters of the universe. The Big Four accounting firms have a firm oligopoly over the provision of tax, accounting, consultancy, and audit services to almost all big companies across the globe.

All publicly listed companies must open their books to external auditors to satisfy financial regulators. The blockchain is often touted as the biggest revolution in accounting since double-entry bookkeeping. Therefore, it stands to reason that blockchain will cause seismic changes for the Big Four, and the way they do business with their clients.

Audits and Accounting Practices

Although software performs much of today’s accounting activities, double-entry bookkeeping is still the practice that underpins the technology. Databases hosted on centralized servers hold records of debits and credits, the same as paper books and later spreadsheets did. The role of finance teams is often heavily focused on reconciliation between different systems, parts of systems, or different internal departments.

The role of auditors is to assess whether or not a firm’s financial statements match its books. This will usually cover whether or not the financial records agree with those of the bank or creditors, whether assets and investments are correctly valued, and whether the controls in place over accounting practices are sufficiently robust as to comply with what is required by law.

The volume of transactions that pass through the books of any given company can be massive. It’s therefore not possible for audits to conduct checks on everything that has taken place in the period under audit. Usually, auditors will request randomized samples of specific transactions that they can trace from beginning to end.

The Bad and the Ugly

Testing random samples is not foolproof. A few samples may easily pass muster, but the underlying accounting practices could nevertheless contain flaws or fraudulent activities.

Even worse, history shows that auditors themselves could be complicit in bad practices. The Enron scandal that broke in 2001 didn’t just cause the closure of the Enron company. It also brought down Arthur Anderson, the accounting firm responsible for auditing Enron, after it was found that they were involved with the fraudulent activities happening within the company. At that time, the Big Five firms became the Big Four accounting companies we have today.

More recently, the collapse of government contractor Carillion in the UK caused members of the government to call for a breakup of the Big Four. The company went into liquidation with liabilities of over £7b, but only $29m in cash. This came after every single one of the Big Four accounting firms had been involved with the company, either in an audit or consulting capacity.

How the Big Four Accounting Firms Are Preparing for Blockchain

Over the coming years, blockchain will cause considerable shifts in accounting and audit processes. Blockchain records the exchange of value between parties, creating a secure and permanent record of transactions, entirely able to be audited using code. Therefore, blockchain is surely destined to take over the process of double-entry bookkeeping in the corporate environment.

Blockchain companies such as Digital Asset and consortia such as R3 are already investing in blockchain as a way of recording transactions between players in the financial markets. The Big Four accounting companies are all taking steps to prepare for blockchain.

All of the Big Four recently joined a Taiwanese consortium of 20 banks to investigate the potential of blockchains uses in fiscal audits. Also, Deloitte and EY have each published papers that outline how they perceive the role of blockchain in the future of the audit process. They acknowledge the future likelihood that blockchain will replace the human part in checking and verifying transactions.

Proprietary Systems

So far, none of the Big Four has yet disclosed a blockchain-based system for auditing company-wide transactions. However, in April, EY announced that it has developed auditing technology for firms using cryptocurrency such as Bitcoin as payments. Called the EY Blockchain Analyzer, the company believes the system “will lay the foundation for testing of blockchain assets, liabilities, equity and smart contracts as companies adopt blockchain technologies.”

PwC has also announced a similar system of its own. Interestingly, PwC has gone as far as stating that the lack of a standard way of auditing blockchain transactions is the very reason that firms have been hesitant to adopt blockchain.

Blockchain could even open up the markets for financial business process and auditing markets beyond the Big Four accounting firms. Smaller competitors such as Cognizant and FIS Global are starting to emerge too. These firms aim to move financial processes onto enterprise-level blockchain solutions.

How Will Blockchain Change the Role of the Auditor?

The role of accountants and auditors will evolve as blockchain starts to embed into accounting practices. Human auditors will no doubt still run the process of defining audit standards and strategies. These will then be coded into a blockchain so transactions are auditable in real-time rather than after the fact.

Checks and controls will become minimized or eliminated. It’s also likely that there will be a governance-based role. A human will need to check that the blockchain network operates fairly and according to agreed principles.

Blockchain will remove the need to reconcile between different entities within a company, as each will share the same set of data. Therefore, accountants are also likely to see a change in their role. A real-time blockchain audit may find errors or inconsistencies in transactions. In this case, a human would have to intervene to determine what has occurred. Finance professionals will also be responsible for internal financial governance.

Final Thoughts

Governments and regulators continue to call for the Big Four accounting companies to loosen their iron grip over the auditing markets. However, regulation is slow to take effect and can only serve reactively.

Blockchain is already creating trustlessness between parties. It also provides a more complete and transparent audit trail than using sample testing. It will be interesting to see if blockchain ultimately proves to disturb the balance of power among the oligopoly – assuming the regulators don’t get there first.

*This post is credited to TheBitcoinNews.

Consultancy firm PwC is kicking off a new “digital skills” program aimed at improving the expertise of its employees on new technologies like blockchain.

The firm will assign 1,000 of its employees to a two-year training program which will cover various digital technology-related, from blockchain to 3D printing to drones, Digiday reported Thursday.

Called Digital Accelerators, the program will begin this January, according to the report.

PwC Digital Accelerators head Sarah McEneaney told the publication that the move is part of a wider effort to help increase the firm’s subject-matter expertise.

“My job is to future proof our workforce … It just seems table stakes at this point that people should have more technology skills. It’s needed for us to remain competitive and to be responsive for what our clients are also going through.”

The training should make employees more efficient as well, reducing the number of hours they spend working on problems, McEneany contended. These savings will be transferred to PwC’s customers.

Roughly 3,500 out of the more than 46,000 employees working at PwC are said to have applied for spots in the program.

During the program, the 1,000 selected employees will work with clients while taking roughly 10 hours worth of courses each week. Data and analytics, which will include information collection and blockchain, will make up the first part of the program’s curriculum.

*This post is credited to CoinDesk

Companies don’t want to be left off of the blockchain bandwagon.

In a new report published by PwC on Monday, 84 percent of executives surveyed said their companies are “actively involved” with the technology.

“Everyone is talking about blockchain, and no one wants to be left behind,” according to PwC’s 2018 Global Blockchain Survey, which included 600 executives from 15 territories.

Blockchain is the technology that underlies cryptocurrencies like bitcoin. It records transactions on a public, distributed ledger and gets rid of the need for a third party in most cases. The technology is touted as faster and more secure by advocates and is being tested for everything from health records to the legal marijuana industry.

Among the PwC respondents, who were business executives with technology responsibilities, 45 percent said “trust” could be the key roadblock in blockchain’s widespread adoption.

“In reality, companies confront trust issues at nearly every turn,” PwC said. “As with any emerging technology, challenges and doubts exist around blockchain’s reliability, speed, security and scalability.”

While high profile investors like Warren Buffett and Jamie Dimon have been publicly wary of investing in cryptocurrency, they’re far more bullish on its underlying tech.

Companies including Amazon, Microsoft and Facebook are exploring use cases for the technology. Facebook announced in May it is going through a reorganization that will include a new blockchain effort. IBM, Accenture, Deloitte, JP Morgan, and HSBC are among the other corporate names with similar initiatives.

Still, respondents mentioned regulatory uncertainty, “ability to bring the network together,” compliance concerns, and intellectual property concerns as key obstacles for blockchain adoption.

Blockchain’s potential has been compared to the internet but so has its hype. In some well-publicized cases, even adding the word “blockchain” to a public company’s name can send its shares skyrocketing in a single day.

Despite the growing interest, other research from Cowen estimated it will take 5.9 years for blockchain to gain widespread adoption.

*Post is credited to CNBC