Each year internal auditors around the world make a concerted effort to raise awareness of our profession during May. Internal Audit Awareness Month has become a celebration of the great value internal auditors bring to their organizations, from providing assurance on compliance and governance issues to advising on emerging risks and business strategies.
Indeed, for 2016, participation in Internal Audit Awareness Month was as extensive as ever. From Malawi to Mexico, through conferences and social media posts, discussions long and short expounded on the pride practitioners have in our esteemed profession.
But this outpouring of pride and awareness should not focus only on what internal audit does for organizations today. Our message also must focus on what internal audit can and should be doing for our organizations in the future. Part of raising awareness among stakeholders, including investors and the general public, is creating excitement about the future of internal audit.
It is no secret to anyone who has been in the profession as long as I have that internal audit continually adapts and changes with the pace and demands of business. Over more than 40 years I have seen the profession change from cyclical-based auditing to risk-based. I have seen stakeholder awareness change to where our profession is now rarely pigeonholed into simply providing assurance on financial reporting.
Increasingly, stakeholders are recognizing the value in internal audit’s unbiased assessments, enterprise-wide perspectives, and insights. These should be exciting and heady days for anyone in our profession. As stakeholder recognition of internal audit’s value grows, we edge closer to the goal of becoming the trusted advisor to management and the board.
But there is a corresponding obligation that comes with this new recognition of internal audit’s value. We must adapt our skill sets and mind-sets to provide the highest caliber service on any task when called upon by our stakeholders, and we must accomplish this while maintaining an independent and unbiased approach to our work.
I know this is a tall order, but the key is to go into that future with clear minds and unshakeable core principles. As we look at the internal audit horizon there are a number of things that should give us both hope and pause.
First, we must continue to enhance the skills required to identify and respond to emerging risks. This means more than identifying and monitoring key risk indicators — it involves developing the critical thinking skills and business acumen that helps anticipate change and new challenges. The speed at which emerging risks develop and mature is growing ever faster. This is at the heart of my frequent admonition to practitioners to “audit at the speed of risk.”
On the technology front, we must embrace the challenge of keeping pace with technological change. This means more than just adopting technology that makes us more efficient and effective as internal auditors. It also includes growing our knowledge of how technology impacts every aspect of the organization. It means building strong, trusting, and cooperative relations with chief information officers, IT managers, and others likely to be early adopters of new technology.
Building our business acumen and critical thinking also opens the door to providing valuable advice on business strategy. From providing assurance on how big data drives strategic decisions to understanding the role culture plays in the root cause of deficiencies and inefficiencies, internal audit can bring much to the table in discussions about business strategy.
When internal auditors can address these issues — emerging risk, the impact of technology, and contributing to strategic business decisions — it will be in a position to provide what may be the most valuable service — foresight.
I envision a future where every internal audit function will have the knowledge and expertise to peek over the horizon and provide foresight to the organization. Getting there won’t be easy, but one additional trait that will help get us there is an appetite for knowledge that enlightens our views and expands our perspective.
As always, I look forward to your comments.