The next quarter will provide internal auditors with plenty of opportunities to add value to the business and remain relevant in a changing landscape.
We've seen many examples of internal audit teams continuing to increase buy-in from stakeholders as a provider of valued-added business partnering.
Internal audit has been in a unique position to help businesses as they have responded and adapted to new conditions. The shape of that response will continue to evolve as risks continue to change, and teams need to remain resilient as an audit function moving forward.
Internal audit aligned with strategic outcomes
As we begin to think about the ‘new normal’ and restoring ‘business as usual’, it is vital that internal audit teams continue to deliver their risk and internal control responsibilities, while staying relevant in the next quarter. An internal audit that focuses on outcomes is vital within a forward-looking, solution-based approach. It provides assurance in a way that enables business and facilitates successful audit outcomes, with visibility to all stakeholders.
Early engagement with the audit committee and other stakeholders is a must to help internal audit functions understand their key priorities. Discussions will help teams understand any critical work required, and whether there are any new or elevated risks that need incorporating.
Four steps to show internal audit success
Here are four steps on how internal audit can demonstrate a successful outcome:
1 Confirm your internal audit reporting requirements to the audit committee – think ahead about topics you want to report and start tracking progress
2 Agree on what success will look like – continue the dialogue with the audit committee chair and provide a view of areas for consideration over the next three to six months to meet internal control declaration requirements
3 Capture success stories – emphasise where internal audit teams add value, adapt and support the business to demonstrate what the function can do in the future. Share success stories and positive events to maintain a positive outlook
4 Refine your KPIs to support the demonstration of your effectiveness as the business landscape changes
How to demonstrate audit outcomes
What is a good outcome for internal audit over the next three months? The table below outlines potential outcomes to consider and how to demonstrate them.
Outcomes to consider
How to demonstrate outcome
Signposted high or emerging risk areas to management to help them prioritise.
Develop an interim audit plan focused on the priority risks and discuss emerging findings.
Deliver real-time SME insight at decision forums.
Leverage internal audit networks to discuss good practices and learnings from other geographies.
Provided assurance on evolving COVID-19 key risks and control environment impacts.
Provide an increased level of assurance, covering emerging risk areas.
Collaborate with stakeholders to understand emerging risks and to assess the support with the prevision of assurance.
Increased profile as a responsive, credible, relevant business partner.
Use data and predictive analytics to support management decision-making, taking into account stakeholder feedback on internal audit insights and requests for audits/support.
To maintain effectiveness, provide man-days to the business sharing capacity and skillsets.
Innovated audit delivery to meet the risk conditions, control environment and business cadence.
Consider adopting an agile approach with the deployment of innovative assurance techniques, eg, develop agile methods; apply rapid assurance reviews and heartbeat assurance delivery, using remote auditing tools and solutions and ongoing assurance.
Embrace re-prioritisation and regular review/updates to the audit plan to mirror the changing pace of risk and assurance needs; track key audit actions.
Enhance methods of communication – the use of data, decision support memos, real-time insight outputs and incorporating internal audit insights into existing business reporting.
Facilitated planning for the return to the new business as usual.
Take the opportunity to adopt practices that have proved effective during the coronavirus pandemic. Provide early insight on focus areas and key risks for the 'new normal', eg, positive effects arising from remote working, changes to culture, post-furlough impacts and responses.
Collaborate with the business to assess and evaluate the business programme, and project priorities.
Kept the internal audit team trained, connected and motivated.
Stay connected with all teams – consider team satisfaction, and the delivery of a targeted and value-added training plan.
As the risk landscape continues to change, it is important for internal audit to reassess processes, to refocus on new opportunities beyond the pandemic and, ultimately, to emphasise what could make the difference between being successful or not.