Internal Audit - the next 20 years

WHERE IS THE INTERNAL AUDIT PROFESSION IS HEADING IN 5, 10 OR 20 YEARS FROM NOW?

We believe internal audit will remain a very important function in the future. Stricter regulatory requirements, stakeholder needs and the continued fraud, waste and abuse that occurs globally to start.

It’s a statutory requirement in many parts of the world to have an internal audit function. The global recession, corporate failures, banking crises, money laundering, corporate fraud, cyber-attacks, volatile market and disruptive innovation, etc. all necessitate the need for an internal audit function in the future as well.

WHAT CAN INTERNAL AUDITORS DO TO EQUIP THEMSELVES AND REMAIN COMPETITIVE AND EFFECTIVE AS VALUE ADDING LEADERS IN THE ORGANIZATION?

There is a need to change the mindset of the auditor.  Our primary purpose is to help the organization to achieve its objective. Mostly, internal auditors are more focused on how to audit rather than why to audit.

It’s up to the internal auditor, to choose to act like a doctor or a police officer or strike a balance between both.

How to audit raises the element of independent and objective. How to audit also demand to consider several factors such as the nature of the business, industry norm, management style, internal culture, control environment etc.

WHAT WOULD BE THE BEST STARTING POINT FOR AN INTERNAL AUDITOR TO MOVE TOWARDS BECOMING A TRUSTED STRATEGIC ADVISER TO THE BUSINESS?

In future, the most successful audit professionals will be the one, who embrace the change and be ready to adapt to tackle new challenges of future risks.

The traditional approach is required, but in the current volatile environment, we have to have more innovative ideas and approach to safeguard the interest of shareholder/stakeholder. May be that’s one of the reasons that IIA revised the internal audit definition, which encompass along with audit assurance, advisory role as well.

In the very near future the audit professional will dramatically move from periodic to continuous audit, from manual or semi-automated to fully automated controls, from sampling to a 100 % population review, from providing assurance on historical data to providing assurance on emerging risk, from assessing business continuity to ensuring business resilience, from improving efficiency to recommending changes and innovation.

HOW AUDITOR CAN EQUIP THEMSELVES?
It’s simple - be open, be welcoming, be informed, be flexible.

In terms of technical skills, auditors should be aware of its surroundings, be its industry knowledge, global issues, political turmoil or disruptive innovation. It is important for auditor to study its impact on the business e.g. bit coin, driver-less cars, Hyper-loop travel, 3D construction printing, data transfer, hydroponics farming techniques etc.

In terms of interpersonal skills, the auditor can improve their communication, presentation, leadership and human psychology skills, without which it’s difficult to achieve desired objectives.