Paper 2 of 6 · Session 1: Financial & Accounting IS
Continuous-Audit Architectures for Bulgarian Public-Sector Entities: A Design-Science Investigation
Milena Stoyanova, Dimiter Velev, Plamena Zlateva · UNWE Sofia · IICT BAS
Abstract
Continuous-auditing techniques, while well-established in the international literature, remain underexplored in the public-sector contexts of Central and Eastern Europe. This paper develops a design-science research programme that produces a reference architecture (CA-REF v1.0), an integration-pattern catalogue, and an evaluation rubric for continuous-audit deployment in Bulgarian public-sector entities. We evaluate the artefacts through three demonstration cases — a municipal budget unit, a regional health-fund branch, and a second-tier executive agency — with an evaluator panel of eight senior internal auditors. The paper contributes a transferable architecture, identifies five recurrent integration patterns, and offers cautious optimism about the feasibility of continuous-audit adoption in Bulgarian and broader Western-Balkan public-administration contexts.
1. Introduction
Continuous auditing — the practice of providing audit assurance simultaneously with, or shortly after, the occurrence of relevant economic events — has been an object of academic enquiry for nearly four decades. Despite its theoretical attractiveness, deployment in public-sector contexts remains rare, particularly in Central and Eastern Europe. The Bulgarian National Audit Office, like its counterparts in Romania (Curtea de Conturi) and Serbia (Državna revizorska institucija), continues to operate on a predominantly cyclical, retrospective audit model. This paper investigates the architectural prerequisites for continuous-audit adoption in Bulgarian public-sector entities through a Hevner-style design-science research programme.
2. Theoretical Background
We build on the continuous-auditing tradition originating in Vasarhelyi & Halper (1991) and refined through Alles, Kogan and Vasarhelyi's series of design-science contributions (2002–2018). The Bulgarian public-sector institutional context is described using Hood & Heald's (2006) categories of administrative transparency and the post-2007 EU-accession audit-reform literature for South-East Europe.
3. Method
Design-science research, three iterations, conducted between January 2023 and May 2024 in cooperation with two Bulgarian municipalities (anonymised as M1 and M2) and one second-tier budget unit. Artefacts produced: a reference architecture (CA-REF v1.0), an integration pattern catalogue (eight patterns), and an evaluation rubric calibrated to the Bulgarian Internal Audit in the Public Sector Act.
4. Artefacts & Evaluation
The CA-REF v1.0 reference architecture decomposes into four layers: source-system integration (using the Bulgarian e-government bus, EISPP), continuous-monitoring rules engine, alert triage and case management, and reporting to the State Audit Office. Evaluation against the rubric showed CA-REF v1.0 was judged feasible by 7 of 8 internal-audit informants and unfeasible by one (on grounds of upstream master-data inconsistency).
5. Discussion & Limitations
The study contributes a transferable architecture and offers cautious optimism about public-sector continuous-audit adoption. Limitations include the small evaluator pool and the exclusion of national-treasury systems.
6. Conclusion
The artefacts presented are now under pilot at M1 and will be extended to four further Bulgarian municipalities during 2025 under a research grant from the Bulgarian National Science Fund.
References (selected)
- Vasarhelyi, M. & Halper, F. (1991). The continuous audit of online systems. Auditing: A Journal of Practice & Theory, 10(1), 110–125.
- Alles, M., Kogan, A. & Vasarhelyi, M. (2018). Continuous auditing: the audit of the future. Managerial Auditing Journal, 17(3), 150–158.
- Hood, C. & Heald, D. (2006). Transparency: The Key to Better Governance? OUP.
- Kaloyanova, K. (2019). Continuous audit in the Bulgarian public sector — initial observations. Yearbook of FMI Sofia University, 106, 245–262.