The Big Four professional services firms — among the largest employers of graduates globally — are drastically rethinking their hiring practices as technology transforms the way companies are audited.

As parts of the audit process are automated, and firms embrace artificial intelligence, much of the mundane administrative work often given to entry-level employees is being eliminated. This has led to predictions of a significant fall in graduate recruitment at some of the biggest auditors.

“Over time our graduate needs are coming down,” said Steve Varley, chairman and managing partner for the UK and Ireland at EY. “We hired 650 graduates in 2010 and 1,200 graduates in 2015. Given the rate at which technology is speeding up audit, that number could drop by 50 per cent in 2020.”

At the same time, the increasing adoption of technology means graduates with skills in areas such as data analytics and computer sciences are in high demand.

Over the medium term, the hiring model of the professional services firms will change dramatically, according to Jim Peterson, a US-based accounting specialist and author. “Firms will no longer need armies of junior staff but instead will need the best algorithm design geeks in the world,” he said. “They will audit large companies with a team that can fit into a conference room, rather than occupying an entire office tower.”

As firms embrace data analytics, a big challenge is making sure they have the right balance of skills.

Adrian Stone, UK head of audit at KPMG, said: “We’re not at the stage of computers replacing people. Right now the challenge is to make sure we have the correct balance of people who will do the interpreting and people who will make sure computers are set up to interrogate properly.”

Jon Raphael, chief innovation officer at Deloitte in New York said the firm was “starting to hire more specialists to help with data analysis and data acquisition”.

The greater emphasis on technology skills means firms may have to cast the net wider during their hiring search, putting them head to head with tech groups such as Apple and Alphabet.

Stephen Griggs, managing partner of audit and risk advisory at Deloitte UK, said: “We may have to start recruiting from technology companies. In the modern world these guys will be hot talent so they will be an expensive resource.”

William Kring, a senior academic researcher at Boston University also said he expected to see “a greater emphasis on the IT background of the applicants from business schools”.

“I would expect recruiters to focus increasingly on the analytical ability of the auditors,” he said.

James Chalmers, head of assurance at PwC, which is a top three graduate employer in the UK, did not believe the number of graduates the firm hired would decrease.

“If you take the view that this is the fourth industrial revolution we think the increased adoption of technology and artificial intelligence creates opportunities around solving new and different problems,” he said. “We think that will fuel growth for the business,” .