AuditBoard announced the results of a survey of corporate chief audit executives (CAEs) that reveals the long-term impacts of COVID on their operations and the profession at large.
The survey polled more than 175 CAEs across a range of industries, uncovering five key trends respondents believe will have long-term impacts on internal audit teams — from an increased reliance on technology to innovative new ways of conducting audits.
Audit teams will be more focused on innovative means
83% of audit teams said the creative solutions they deployed in the process of working around lockdown limitations produced new efficiencies — as well as new methods — for evidence gathering. Among the innovative uses of technology that have proven effective in the past year have been the use of drones, reliance on pre-positioned security camera video feeds, and video documentation by smartphones and other devices.
Chief audit executives have reported that the use of drones to document the physical existence of assets or control effectiveness has provided sufficient evidence more efficiently than even traditional means.
The use of technology will be more critical to conducting internal audits
For a profession that has traditionally relied on face-to-face meetings and access to physical evidence, mandatory lockdowns necessitated the greater use of technology to continue working. In particular, cloud-based platforms that were designed to not only facilitate remote collaboration, but also automate workflows across the three lines, were successful in streamlining and facilitating the actions of multiple stakeholders to reach common, intersecting goals.
Going forward, CAEs believe the use of technology will continue to play an important role in internal audit processes, with 91% of CAEs agreeing with this statement.
Most face-to-face meetings will be replaced with virtual meetings
By all accounts, audit, risk, and compliance professionals have embraced video platforms not only for meetings between members of the internal audit staff, but also for meetings and other face-to-face interaction throughout the audit process and communications with key stakeholders.
72% of CAEs believe their teams will likely continue to rely heavily on technology-facilitated meetings as a more efficient means of communication.
Internal audit teams will focus more on emerging risks and their possible impacts
The pandemic has proven beyond doubt that the dynamic nature and velocity of risks must be an overarching consideration for internal auditors and other risk professionals. 72% of CAEs said they will put a greater focus on emerging risks and their possible impacts, speaking to the importance of auditing at the speed of risk.
Now, there must be a continuous component to assessing risks, not only in performing risk assessments with greater frequency, but in the methodologies and technologies used to create a continuously monitoring risk function.
Internal audit teams are unlikely to return to a traditional workplace model
The COVID experience has demonstrated loud and clear that the internal audit workplace of the future does not need to be exclusively in a traditional office setting. 68% of CAEs said they will embrace flexible workplace arrangements in the future. This may prove particularly true in markets where internal audit talent (especially expertise in specialized risks) is in short supply.
“In many ways the COVID-19 pandemic has been the most disruptive event in the history of the internal audit profession. Without question, the events of the past 18 months have triggered fundamental changes in how audit, risk, and compliance professionals undertake their responsibilities — from how we communicate with our teams and other stakeholders to our day-to-day processes,” said Richard Chambers, Senior Internal Audit Advisor at AuditBoard.
“It’s clear the internal audit profession is evolving to be more flexible, innovative, and productive, leveraging technology to stay resilient in an environment where risk priorities can shift overnight.”