THE NEXT GENERATION OF INTERNAL AUDIT

INTERNAL AUDIT TRANSFORMATION FOCUS AREAS

ENABLING TECHNOLOGIES

• Advanced Analytics & Automation
• Robotic Process Automation (RPA) & Desktop Automation (RDA)
• Machine Learning (ML)
• Process Mining

ADVANCED ANALYTICS & AUTOMATION

ADVANCED ANALYTICS & AUTOMATION

ROBOTIC PROCESS AUTOMATION (RPA)

ROBOTIC PROCESS AUTOMATION (RPA)

MACHINE LEARNING (ML)

PROCESS MINING

METHODOLOGY

• Continuous Monitoring & Predictive Analysis
• High Impact Reporting
• Agile Audit Approach
• Dynamic Risk Assessment & Planning

CONTINUOUS MONITORING & PREDICTIVE ANALYTICS

• Can be used to influence audit universe and risk assessment process
• Can be used to scope individual engagements
• Develop continuous monitoring and risk sensing capability that line management uses and values

HIGH IMPACT REPORTING

• Contains things like:
• Videos
• Data Visualization
• Report Generation Automation
• Self-service Reporting (e.g., “just in time” findings or dashboards)

AGILE AUDITING

• Step 1 (program level): Utilize a data-driven approach to assessing team structures (e.g., # of reports completed per auditor, avg. audit duration, etc.)
• Step 2 (engagement level): Conduct fieldwork in confined, risk-based sprints.

METHODOLOGY: DYNAMIC RISK ASSESSMENT & PLANNING

• Use risk or audit universe as basis to create risk assessment
• Assess risks using qualitative and quantitative measures
• Revisit risk assessment during year to determine reprioritizations

METHODOLOGY: DYNAMIC RISK ASSESSMENT & PLANNING

• Insert Planning Graphic

GOVERNANCE

• Aligned Assurance
• Talent Management
• Organizational Structures
• Strategy & Planning

GOVERNANCE: ALIGNED ASSURANCE

• Coordinate risk assessment with other risk and control groups
• Provide assurance on common risk taxonomy.
• Provide Board of Directors and Senior Management risk reporting 2nd and 3rd line of defense.

GOVERNANCE: TALENT

• Establish a continuous workforce planning process and clearly identify desired competencies (e.g. digital, advisory, etc.)
• Agree on approach and actions to source, develop, and acquire needed skills
• Provide career pathing information that aligns to needed compentencies
• Consider technologies to accelerate skill development

GOVERNANCE: ORGANIZATIONAL STRUCTURES

• Reduce duplicate risk coverage (e.g., SOX Compliance, Lines of Defense).
• Structures should support need for technical subject matter experts (e.g., analytics or data science, IT auditors) and non-auditor roles (e.g., transformation, metrics & reporting, operational support).
• Consider cost vs. benefit of offshore or 3rd party staff augmentation or managed outcome support.

GOVERNANCE: STRATEGY AND PLANNING

• Set a clear vision
• Baseline how you are operating today
• Be bold in your transformation actions
• Provide transparency into the investment and trade off decisions
• Monitor progress and return on investment

TRANSFORMATION KEYS TO SUCCESS

• Focus short-term on attitudes, mindsets, and behaviors - over compentencies
• Develop competencies incrementally
• Organize top technical talent towards a focus on advancing transformation and enabling technologies
• Promote innovation and experimentation, take smart risks, and have ways to manage.