Auditing in the Video Game Industry
Ever since the Atari console was released in 1972, video games have grown to become one of the most prominent forms of entertainment in the modern world. With the increasing popularity of video games and the rise of e-sports, the video game industry has proven itself to be massive. In 2021, the global gaming industry generated $180.3 billion, and that number is expected to reach $200 billion in 2023, though the volatility of the industry is something that many people in the industry have pointed out. However, what role does audit have, and how can it help the video game industry?
Both the gaming production industry and the e-sports scene have seen their fair share of preventable scandals surrounding financial problems. Among them are startup video game projects that were revealed to have been a way to scam investors out of their money. Most notoriously known is Star Citizen, a $500 million project that has gained controversy due to the progress of development that does not align with its financial investment, with the game going into its 11th development year yet no official release date.
With how much money is being generated from the industry comes all kinds of risks that could prove to be detrimental. Had there been an audit either internally or externally, cases such as the ones discussed before could have been prevented. Other than that, an audit could help the industry by finding loopholes in the company’s regulatory standard, helping financial sustainability, and, to some extent, protecting against cybersecurity-related problems, among many other things.
The increasing interest and overall market potential in the gaming industry also come with the increasing standard of professionalism needed on the management and financial sides of the industry. Being a still-yet volatile industry, auditors could help control the volatility by preventing the problems from getting to a bankruptcy-inducing scale. Simply put, the role of auditors is one of significant importance to ensure the gaming industry can prosper further in the future.
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