PWC's recently released whitepaper, "Moving at the Speed of Innovation: 2018 State of the Internal Audit Profession", is a must-read for all Internal Audit teams and internal auditors trying to chart their course for 2018 and beyond.
A key finding is that technology adoption drives a major difference in how internal auditors are perceived by the companies they work for. Those that adopt automation and continuous audit capabilities are seen as more relevant and add more value whereas those that use conventional manual processes are seen as necessary cost centers that often don't deliver as much value to the company.
The PWC report is based on surveys of over 2,500 internal audit departments in 92 countries, as well as interviews with senior management with PWC customers.
Some of the takeaways and predictions resonated because they clearly reflect what we see with the audit teams we work with. Here are some key insights:
- Risk professionals must help their organizations make sure that processes and controls are effective while not slowing innovation’s pace
- Internal audit functions can only serve in this valuable capacity if they are innovating
- Innovation-driven organizations need innovation-drive internal audit functions, or Internal Audit’s value will diminish
But the most striking insight was that 75% of the companies using advanced technology to automate audit functions saw their Internal Audit teams as adding value to the company compared to barely a third of slow adopters. This difference affects not just the IA department but potentially the careers of individual team members:
To adapt, internal audit departments must shift their underlying methodologies to more-ongoing, continuous or real-time modes of audit.
I was not surprised to see this viewpoint from PWC. We hear similar sentiments and support for technology approaches from them as we work together on joint customers. But the significance of the difference is still impressive.
You can read the full report here.