Blockchain is the underlying technology that supports the digital currency Bitcoin. The technology is a system of distributed ledgers. To validate the transactions on the ledgers, independent users verify the transactions. Once the transaction has been verified, it is stored permanently in the distributed ledger.
Traditionally, third party auditors carry out the function of verifying transactions. Through adopting blockchain, auditors can rely on the already verified transactions that are permanently stored in the system. This will reduce the time required to perform an audit since auditors will no longer have to verify individual transactions.
Adopting blockchain may allow third party auditors to rely on the blockchain auditors and focus more on a governance role for the types of blockchain transactions. Overall, blockchain is changing the way that financial transactions are being recorded and as such will disrupt the industries that have been created to verify the transaction systems currently in place.
Resource:
http://economia.icaew.com/features/july-2016/how-blockchain-will-impact-accountants-and-auditors