Digital Internal Audit: It’s a journey, not a destination has been saved
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Digital Internal Audit: It’s a journey, not a destination
The road map for IA functions to maximize the benefits of digital investment
As digital has become an essential enabler of strategy, Internal Audit (IA) functions are embarking on a digital journey that aligns with their vision and goals. Here’s an in-depth view of how IA can ride the digital wave to deliver better insights, quality, efficiency, and impact.
As organizations navigate new risk factors and require more from IA, chief audit executives are turning to digital transformation to help close the gaps. It would require leaders to deploy analytics, automation, and other tech solutions to increase efficiency, drive greater insights, decrease errors, and free up resources for value-added work. Integrating and embedding digital assets or enablers (technologies, channels, and ways of working) to transform existing operational processes and increase the value offered to stakeholders isn’t easy. It requires a cultural shift and a mindset of experimentation, innovation, and challenging the status quo. Digital transformation is the journey of IA functions to truly embed digital assets and ways of working into their function in line with their vision and strategy.
Digital Internal Audit: It’s a journey, not a destination
Embarking on the digital journey
Options to collect, curate, and analyze data have never been greater, and now is the time for IA to lay a strong foundation for the future. Business leaders and IA stakeholders increasingly rely on data to support critical decisions. Data enables fact-based decisions that can improve business strategies, operations, and grow the top line. Embracing the power of digital transformation in IA functions is a journey unique to every organization’s goals. However, one thing is common—the way to transformation requires both methods and mindset.
Building a digital strategy supports alignment with IA’s vision and goals and sets the priority for longer-term investments. Consider strategic components of vision, people, processes, technology, and data and how they tie to your purpose.
Upskilling is critical. Auditors need to develop digital fluency and the necessary skills to recognize and develop opportunities for analytics and automation.
Embed digital assets across your audit life cycle, helping to improve risk sensing, auditor awareness, and effectiveness of coverage while significantly reducing effort.
Saving time, increasing risk awareness, gaining new insights, and automating repetitive tasks—AI is now a proven tool in the auditor toolkit.
With the right data insights, business leaders can make more informed, effective decisions that will improve business performance. Research shows that business leaders are significantly more likely to act when IA supports recommendations with data.
The advantages of digital investment in IA
Investing in digital opportunities can prove transformative for organizations. It enables increased automation, leading to a reduction of manual processes and improved assurance coverage. This investment also stimulates efficiency gains and significant cost savings throughout the audit life cycle. Furthermore, it enhances analytics capabilities across each audit phase, promoting greater insights from centralized data sources. Notably, it also aids in reducing staff turnover in the IA department while improving skillsets and strengthening stakeholder relationships across the organization. Lastly, it bolsters regulatory readiness, ensuring increased preparedness for regulatory responses and decreased regulatory risk. The expansion of digital capabilities throughout the IA function can help reveal outdated business processes and assign technology solutions to remedy them, thereby fostering a robust and resilient organization.
Considerations for IA functions
IA can catalyze positive change by bolstering data-driven decisions, providing insights, and predicting key risks. The digital transformation journey, though time-consuming, can revolutionize the IA function and its value. Successful IA functions commonly address four key elements:
- Understanding of organizational priorities, both short and long-term
- Alignment with the technology and data strategy of the enterprise
- Establishment of a strong vision and communication of its importance
- Recognition that this is a transformation and not just a project
Deloitte understands how to empower IA through digital
Implementing the right digital solution for your organization can enable your auditors to reach their goals faster and deliver better insights. Deloitte can help you align strategically, find and implement the right solution, and improve continuously.
Three primary enterprise service delivery goals
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Purpose
Digital is an enabler of strategy, not a goal. Understanding your north star or purpose can result in the strategic use of digital to deliver better insights, quality, efficiency, collaboration, and impact.
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Assess
By leveraging Deloitte’s Insight-Driven Organization framework, we can assess the IA team’s current and desired future maturity levels and identify where opportunities for action exist.
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Design
By entrenching data, analysis, and reasoning into IA’s decision-making processes, we turn digital into a core capability while promoting a culture of insight-driven auditing.
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Execute
Strategy can be brought to life through the deployment of digital technologies across the IA life cycle, including risk assessment, planning, fieldwork, reporting, and monitoring.
The Deloitte approach to bringing digital to IA:
● Perform end-to-end assessment of current IA life cycle processes to identify areas for improvement, e.g., annual planning, scheduling, and reporting
● Conduct lean Six Sigma analysis to identify root cause issues in the life cycle process
● Analyze technology and system architecture supporting current state processes
● Identify opportunities for leveraging modern technologies, such as cloud, AI, and data storage and processing
● Leverage automation and AI to enhance coverage and insight
● Review existing methods and practices to identify gaps and required updates
● Refresh existing standard operating procedures (SOPs), policies, and procedures to align with enhanced processes and systems
● Upskill talent with the latest technical and soft skills (e.g., Citizen Led Development, telling stories with data)
● Develop an ongoing training program to enable auditors to continuously advance their skill set
● Focus on auditor mindset
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