On the audit committee’s agenda
What’s on the horizon for 2022?
The past year has made it clear that many of the fundamental changes to organizations that were brought on by the pandemic are here for the long haul. The impacts of widespread remote work, accelerated digital transformation, and shifts in talent dynamics have been far-reaching, and the full scope of their effects—and related risks—is not yet certain.
Internal Audit: Risks and opportunities for 2022
While the current environment has surely triggered many feelings of powerlessness and uncertainty, this paper can serve as a counterweight: a motivating and organizing influence; an incentive to get your house in order, your priorities straight, and your action plan initiated. Risks are plentiful but the
opportunities are even greater. And internal audit can be the difference maker.
Internal audit functions that embrace the risk/opportunity and assure/advise
dualities will help their organizations emerge stronger from these unprecedented times.
Nine ways to strengthen Internal Audit's impact and influence in the organization
Among the most disturbing findings of Deloitte’s Global Chief Audit Executive Survey - 20161 is Internal Audit’s lack of impact and influence within the organization. Only 28 percent of chief audit executives (CAEs) believe their functions have strong impact and influence in their organizations, while 16 percent felt that Internal Audit has little to no impact and influence.
Boards, audit committees, senior executives, risk managers, and the business need Internal Audit’s best efforts in this time of ongoing disruption and increasing risk. They also need Internal Audit’s objective, enterprise-wide perspective, and its rigorous observational and analytical skills in more areas than ever.
We have identified nine proven ways in which CAEs have responded effectively to stakeholders’ needs and, in doing so, increased their functions’ impact and influence.
High-impact areas of focus 2017
In any organization, there are numerous areas where Internal Audit’s objectivity, perspective, and skills can assist stakeholders and provide valuable insight. Yet Deloitte’s 2016 Global Chief Audit Executive (CAE) survey1 revealed that only 28 percent of CAEs believe their functions have strong impact and influence within their organizations. This raises a question: Where can Internal Audit have the most positive impact and influence? Though the answers differ for each Internal Audit group, generally impact and influence increase when Internal Audit attends to areas of greatest risk, importance, and concern to key stakeholders.
This year’s edition of our Internal Audit Insights series identifies eleven areas of high impact for Internal Audit in the year ahead. It also explains why these areas are important to stakeholders and how Internal Audit might approach the area in upcoming audit plans.
Adapt or disappear
“By this time next year, Airbnb will earn the title as the largest hotel chain in the world.”‘
Designation as the world’s top lodge may be of interest to the hotelier community but perhaps few others, except for one extraordinary fact: Airbnb does not own a single hotel room. Instead, Airbnb shook the foundation of the hotel industry by leveraging technology to transform the business model from product-based to service-based. Uber has very low marginal cost to add a new car to its fleet. Google’s marginal cost to running an extra search query is almost zero. Waze, the world's largest community-based traffic and navigation app, has reached almost 100 million users solely by word of mouth and accesses each one’s GPS to provide accurate traffic prediction.
This rapidly changing landscape presents an opportunity to bold CAEs and their teams. But to help the company adapt, internal audit must also change.
The future may bear little resemblance to the past, and only the most forward-thinking companies will survive the transition—with the guidance and support of internal audit.
Global Internal Audit Common Body of Knowledge (CBOK) - "Delivering on the Promise - Measuring Internal Audit Value and Performance“
The Global Internal Audit Common Body of Knowledge (CBOK) is the world’s largest ongoing study of the internal audit profession, including studies of internal audit practitioners and their stakeholders. One of the key components of CBOK 2015 is the global practitioner survey, which provides a comprehensive look at the activities and characteristics of internal auditors worldwide. This project builds on two previous global surveys of internal audit practitioners conducted by The IIA Research Foundation in 2006 (9,366 responses) and 2010 (13,582 responses).
Reports will be released on a monthly basis through July 2016 and can be downloaded free of charge thanks to the generous contributions and support from individuals, professional organizations, IIA chapters, and IIA institutes. More than 25 reports are planned in three formats: 1) core reports, which discuss broad topics, 2) closer looks, which dive deeper into key issues, and 3) fast facts, which focus on a specific region or idea. These reports will explore different aspects of eight knowledge tracks, including technology, risk, talent, and others.
Social Media and the Role of Internal Audit
According to a 2012 survey conducted by Burson-Marstellar, a global public relations firm, 87 percent of the Fortune 100 is now using social media.
While the benefits of social media are alluring, the risks of adoption should not be ignored. Several business executives have expressed concerns that the use of social software and social media — and the potential risks that accompany increased organizational transparency and openness — may erode a company’s brand over time.
This puts IA in an effective position to provide advice on implementing strategies to capitalize on the opportunities presented by the use of social media, while also managing risks appropriately.