PwC India recently announced the results of its seventh annual global survey on the State of the Internal Audit Profession, which found that as companies focus on strategic growth, internal auditors have the opportunity to elevate their roles by aligning their goals with new company priorities.
A survey across 45 territories covering more than 2500 chief audit executives including over 70 from within India, found that internal audit professionals that have a macro view of their companies can play a significant role supporting company growth strategies through their involvement with areas such as emerging markets, mergers and acquisitions, social media, the cloud and navigating the regulatory labyrinth. However, the survey indicated that many internal auditors are not addressing the risks related to these strategies.
For example, this year’s survey showed a disparity between CEOs’ and internal auditors’ main focus when it comes to risk areas such as growth and technology. While CEOs are focused on growth in newer geographic markets, internal auditors indicated that they are least involved in those areas. Similarly, while 70% of CEOs plan to invest in IT, less than 25%of internal auditors plan to be involved in auditing the risks of cloud computing or social media.
CEOs and internal auditors have a shared focus on government regulation, as overregulation ranks among CEOs’ top concerns and nearly 60 percent of internal auditors expect to increase their attention to regulatory compliance programs in their audit plans.
"It is important that internal audit leaders stay on top of CEO business strategies. Emerging markets, technology and regulation are quickly evolving, and the risks associated are quickly changing as a result. If internal audit can keep up with these changes, CEOs and other company stakeholders will see it as a dynamic business function and elevate its importance to the business," said Satyavati Berera – Executive Director and Leader – Internal Audit Services, PwC India.
The study identified three important focus areas for internal audit departments and the risks, including:
- Strategic growth: Emerging markets, mergers and acquisition activity, innovation and new product development
- Information technology: security and data protection risks related to emerging technologies such as eMobility and cloud computing, data lass and distribution of malware
- Regulation: The expanding reach of regulations, changes due to financial reform, and sustainability reporting
As internal auditors re-evaluate their roles, PwC suggests they ask themselves the following questions:
- Am I leveraging my unique vantage point within the company to provide a clear point of view on the risks associated with the changing business environment?
- Have I taken action to adjust capabilities and approaches to today's business environment?
- Am I taking steps to prepare my people for what they will be doing two to three years from now?
Updated Date: Feb 02, 2017 23:11 PM