For internal auditors, innovation is a work in progress
More than three-quarters of internal audit groups (76 percent) are undertaking some form of innovation, according to a new survey by the consulting firm Protiviti, but only 31 percent have a roadmap for it in place.
That means while the internal auditors are positioning themselves for the future, they still have room left for progress.
The survey found that 41 percent of internal audit groups are moderately or far behind their competitors’ internal audit transformation activities. The top 10 audit plan priorities for internal audit this year include enterprise risk management, cybersecurity, vendor risk management, fraud risk management, COSO internal control, agile risk and compliance, lease accounting, cloud computing and revenue recognition.
The types of next-generation internal audit technologies deployed most frequently include advanced analytics (23 percent), process mining (20 percent), robotic process automation (19 percent) and artificial intelligence/machine learning (17 percent).
“Once internal audit departments realize that we’re already in the race to adopt next-gen internal audit capabilities, they’ll need to accept that the journey to the finish line looks more like a marathon than a sprint,” said Brian Christensen, executive vice president of global internal audit at Protiviti, in a statement. “It’s important to remember that transformation to a next-generation internal audit function is not about one or a series of projects, but rather a culture and mindset focused on continuing innovation and seeking ways to do things better by leveraging new processes and the latest technologies.”
The survey was released the same week the Institute of Internal Auditors is holding its General Audit Management Conference in Dallas-Fort Worth, Texas. On Monday, the IIA inducted several people into its American Hall of Distinguished Audit Practitioners, recognizing individuals in the field of internal auditing who have contributed significantly to the profession throughout their lifetime. They include Doug Anderson (a consultant and IIA global board member from 2010 to 2013), Theresa Grafenstine (a managing director in the Deloitte risk and financial advisory practice), and J. Michael Peppers (chief audit executive at the University of Texas System and IIA’s 2017-18 global chairman).
The IIA also released its latest Common Body of Knowledge study Tuesday, in which chief audit executives shared their insights on how to strike the right balance between assurance and consulting services. The study found that CAEs whose functions devoted 20 percent or more of their resources to advisory work said it’s not difficult to maintain objectivity if a handful of key practices are followed.
The IIA’s Internal Audit Foundation also published two books Tuesday outlining some best practices for professional development of internal audit executives: Sawyer’s Internal Auditing: Enhancing and Protecting Organizational Value and A Journey into Auditing Culture: A Story and Practical Guide. On Monday, the IIA also released an updated second edition of IIA president and CEO Richard Chambers’ book, The Speed of Risk: Lessons Learned on the Audit Trail (see IIA CEO Richard Chambers releases follow-up book). The books are available through the IIA bookstore.