21st Century Auditing Needs to Embrace Technology
The widespread evolution of IT business systems has changed the way in which all departments within an organisation operate, and internal audit is no exception.
The use of automation within internal audit has expanded as professionals respond to the global advancement of technology by implementing IT audit functions and increasing their use of Computer Assisted Audit Tools (CAATs). Although many audit departments are steadily embracing new tools available to them, there are still audit teams who are not keeping up with the pace and struggle to recognize the benefits technologies can bring to their day to day tasks.
The Global Internal Audit Common Body of Knowledge, CBOK’s recent research report, Staying a Step Ahead: Internal Audit’s Use of Technology, offered an in depth exploration into the technological habits of internal audit departments. The global practitioner survey is the largest ongoing study of internal audit professionals in the world, with over 14,000 survey responses and 100% participation from IIA institutions in 166 countries.
The internal audit profession should be pleased to see that the reported use of technology by internal audit appears to be growing nicely since prior surveys. While the numbers remain lower than many would like to see, over the years more internal audit departments are making productive use of analytics, including forms of continuous auditing and risk monitoring, to enhance the value and efficiency of their work.
Norman Marks, retired CAE and author of World-Class Internal Audit and World-Class Risk Management, said: "The report highlights that the use of technology in the audit process has continued to develop over the past decade. Over two-thirds of internal audit departments are now using a form of IT to help manage information collected during an audit, track actions and follow ups, and for planning and scheduling audits. There has been a significant increase in the practices of data mining, continuous auditing, process mapping and the use of e-workpapers. These trends are predicted to continue to accelerate as more internal audit teams utilise technologies available to them.
"Despite the success of technology within internal audit, there is still room for improvement. Fewer than 40% of chief audit executives (CAEs) worldwide feel that their departments’ use of technology is ‘appropriate or better’, and 20% confess their audit team primarily rely on manual techniques – highlighting that extensive use of technology is the exception, not the rule. The IIA recommend that audit departments worldwide should develop a vision for use of technology tools over the next two to three years, and ensuring that the plan is communicated to the entire internal audit group.
"The IIA conclude from the report that the use of the specialised software tools leads to huge improvement of productivity within internal audit, through efficient and effective computerized internal audit techniques."
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If your organisation is already using technology to help with your audits, or if you’re planning to implement new computerised processes in your business, get in touch with us today.