Internal Audit Trends: Finance Tips for Innovation

Audit trends are shifting across industry environments due to technological advances, automation, and different ways of doing business. Since operational risk and other types of risk aren’t going anywhere, regulatory compliance will always be a top priority. 

As such, we’ll look at what can be expected for the future of audit and how automation solutions can help you overcome challenges in auditing.

Coming Up

What are Emerging Audit Trends?

How to Address Audit Challenges?

What is the Role of Analytics in the Future of Auditing?

What are Key Areas to Adapt in Audits of the Future?

How Should Internal Auditors Respond to Audit Changes?

Wrap Up

What are Emerging Audit Trends?

Internal and external auditors have an important job to do. Let’s take a look at trends in auditing so you know what to expect. 

1. Proliferation of Data Audits 

Given the massive exponential growth of data that companies collect and generate, audits are more critical than ever. Businesses must verify and review data to ensure that it’s accurate and usable. 

Only by doing so can businesses trust the insights they glean from the data in hand. This is especially true in the case of financial data, given that businesses use this timely information to make crucial business decisions. Additionally, financial data is regulated and requires strict compliance. 

2. Increased Technological Usage 

Of the many audit trends happening, perhaps the most ubiquitous is the rise of technology and advanced solutions to make audits easier to conduct. 

The implementation of artificial intelligence, machine learning, and automation solutions is not only streamlining the audit process itself, but it also helps to identify patterns and rectify issues early on. Automation solutions for finance functions improve efficiency, accuracy, and internal control. 

3. Growth of Internal Audits 

More companies are turning to internal audits to oversee their operations and policies for the sake of compliance and productivity. With the rise in remote work, it’s vital for companies to be able to standardize and oversee how their team across locations is functioning. 

Automation solutions make this possible because you can automate entire workflows and processes with visibility and oversight. 

4. Cybersecurity Audits as a Focus

By 2025, cyber attacks are expected to double, which has led to an increased focus on cybersecurity audits. Cybersecurity audits enable experts to review a company’s security measures and assess how they are keeping up with standards and regulations to protect against vulnerabilities. 

With the use of cloud-based automation software, companies can worry less about protecting their sensitive data because the software is automatically updated with the latest security measures and protocols. 

5. Organizational Structure Built for Visibility 

Organizations with internal control must also know how to balance and provide transparency into their processes so that auditors and auditees can maintain a healthy relationship with one another. From the structure to the technologies at play, internal control and visibility work together to grant this potential. 

6. Managing for Culture 

This trend may seem like it stands out amongst the rest, but it is equally important. Companies need to foster a culture that is actively managed because risks to culture can affect employees’ behavior, organizational systems, and actions. 

Culture is a key driver of productivity and performance, so an active review of organizational culture helps to protect legal, reputational, and operational risks. 

As a result, internal auditors will need to identify key areas of risk and provide practical advice on how to align employees and stakeholders with the overall company vision and way of working. 

7. Disruption is Welcome

Once upon a time, external disruption to an organization was heavily avoided or feared. 

Nowadays, especially given how businesses had to shift on the fly due to the pandemic, disruption is considered to be normal. Internal audit teams have the power to help organizations be prepared for such unpredictable challenges by constantly addressing preparedness. 

Although fully predicting the future is obviously impossible, internal auditors can use risk management to forecast potential risks and its effects on the business. 

How to Address Audit Challenges?

Complex business environments can generate its fair share of audit challenges. However, analytics and technology can help to overcome these hurdles. 

Data analytics can be used to uncover potential risks, fraud, and insights. With automation software in tow, you can automate routine, tedious, and mundane activities, which helps to streamline workflows and increase accuracy. 

Then, by automating analysis, you are able to detect issues before they loom too large to remedy. 

What is the Role of Analytics in the Future of Auditing?

The good news is that that data that’s at your fingertips already can be used for good, given the right solutions. Big data analytics provide auditors with the power to analyze a large volume of data. 

As a result, auditors, whether internal or external, can spot trends and patterns. This is changing the role of auditors overall, as they now serve as strategic advisors for business leaders and stakeholders. 

With knowledge and accurate forecasting, these data audits can help make informed business decisions and prevent fraud.

What are Key Areas to Adapt in Audits of the Future?

By now, you should feel excited and ready to improve your audits to act upon these audit trends. 

To do so, here are a few key measures to apply:

1. Assign an Audit Committee 

Audit managers and designated committees are a primary piece of the puzzle here. They are needed to assess potential issues and advise on a plan of action. Increase the influence of your audit committee and ensure you have proper training in place. 

2. Utilize Data Analytics 

Data analytics are a game changer for auditing departments. With access to a company’s data, auditors can identify trends and relationships that would otherwise go unnoticed. Automation software helps to centralize all your data and systems in a single repository so that your insights are accurate. 

3. Perform Risk Management 

Remember to prioritize risk management for internal audits. Predictive tools and automation technology can assist in assessing what risks are more likely than others, as well as what outcome is to be expected should said risk occur. 

4. Use Automation 

The use of automation tools is imperative when it comes to maximizing productivity, accuracy, and efficiency. 

With finance automation software, your business can seamlessly complete processes 85x faster, enable fraud prevention, and execute key functions without a second thought. 

For example, you can use automation software to complete rebate management, expense analysis, reconciliation, APRA reporting, regulatory reporting, and more. 

How Should Internal Auditors Respond to Audit Changes?

For internal auditors ready to take on these emerging audit trends, some preparation is required. 

To stay on track with audit changes, internal auditors should consider the following:

1. Stay Up-to-Date 

Emerging technologies are constantly changing business environments, and hopefully you can agree, they are for the better! As such, internal auditors should be proactive and learn about the newest solutions. 

Additionally, regulations constantly change, so it’s up to an internal auditor to stay abreast of new policies, laws, and standards. 

2. Get Involved with Decision Making 

Internal auditors play a major role in how stakeholders and business leaders understand the business’ current status quo. Internal auditors should provide guidance and insights to help improve the future of the organization. 

3. Build Relationships 

Bonding with colleagues should be a continuous effort. A culture of openness, honesty, and transparency is pivotal to really understand how the business is faring. 

Wrap Up

Audit trends are emerging due to technological advancements, geopolitical situations, regulatory changes, and the shifts in how businesses are operating. Company culture, automation software, and risk management all remain in the spotlight for internal auditors. 

Automation tools are helping companies to accomplish more with their data, protect their information, increase internal control, and perform analytics that can forecast future outcomes with great accuracy. 

As a result, automation software is a trustworthy must have for internal auditors across sectors.