According to a recent study there is more than a 92 per cent probability that roles such as insurance underwriters, accountants, credit analysts and mortgage brokers will be fully automated within 20 years. The demand for specialist IT auditors will undoubtedly increase and non-specialists will feel the need to add IT audit skills to their repertoires in order to keep pace with the changing environment.
This article is taken from Audit & Risk and explores the impact of changing technologies, regulations and economic circumstances on internal audit in coming years........
“Changing technologies, regulations and economic circumstances will have a real impact on internal audit in coming years and will inform the institute’s priorities in our next three-year strategy,” says Ian Peters, CEO of the IIA.
The future of the profession is a topic that is never far from my mind. The IIA’s three-year strategy looks to the future and provides a framework in which we can develop our core priorities of promoting and developing the profession. 2015/16 signifies the final year of the latest three-year cycle, which means we’re looking to the future to anticipate the potential threats and opportunities for internal audit and formulating strategies for dealing with them.
Next month the IIA Council will spend a full day considering the institute’s future strategy and discussing the factors affecting the changing role of internal audit, including changing technologies, regulations and economic circumstances. All of these factors will have a real impact on internal audit in coming years and will inform the institute’s priorities in our next three-year strategy.
The role of internal audit has been constantly changing since the founding of the IIA. The coming years may see increased pressure on internal audit roles to be amalgamated with second line of defence functions. This may be inconsistent with internal audit’s positioning as an independent and objective assurance function and the implications for internal audit may be significant.
As suggested in PwC’s 2015 State of Internal Audit survey, 60 per cent of heads of internal audit surveyed believe they need to be providing proactive advice and value-added services to their organisations within the next five years. The framing of internal audit may therefore need review in the coming years. Instead of thinking of a core role plus added-value activities, perhaps we should think of how our core role itself can add value to an organisation.
With pressure on central and local government to cut their budgets further over the next few years, internal audit teams could be in the firing line. If internal audit resources are cut too far, the function’s value is lost. But how do we communicate this to key public sector stakeholders?
Technological change has always been something that the profession has had to adapt to over the years. The future will be no different. According to a recent study there is more than a 92 per cent probability that roles such as insurance underwriters, accountants, credit analysts and mortgage brokers will be fully automated within 20 years. The demand for specialist IT auditors will undoubtedly increase and non-specialists will feel the need to add IT audit skills to their repertoires in order to keep pace with the changing environment.
Technology will also change how the institute supports and develops the profession. We are in the process of moving a greater portion of our resources and services online. This is part of our digital vision. In the future the potential to utilise the online space is endless; online-only tuition and virtual networking events are just two of the developments that could transform the way we interact with members.
These are just some of the issues that internal audit will face in the coming years. Many of these challenges will require the institute to respond in new and innovative ways. We may not be able to predict everything that is coming our way, but I am confident in the ability of internal auditors to adapt to change as they have done in the past.