Home > Risk > Auditing in a turbulent and dynamic environment

Auditing in a turbulent and dynamic environment

There’s little doubt that this year has brought many challenges to organizations and their internal audit teams in every corner of the world.

It has been both a challenge and an opportunity: an opportunity to sit back and consider whether there is a better way for internal audit to work.

For example:

  • How often should we update our understanding of the risks and opportunities facing the organization?
  • How often should we update the audit plan?
  • How do we make sure we know about new or changed risks so we are in a position to update the plan?
  • If we update the plan at the speed of risk, how do we communicate that to management and the audit committee? Do we continue to measure ourselves based on completion of the annual audit plan?
  • Do we have the right people and resources to address all the issues that matter to the success of the organization?
  • Are we auditing issues that are not worth our time? Do our audits include in their scope issues that, should we find deficiencies, would not be significant to top management and the board?
  • How do we change from full-scope audits to those that only focus on things that matter?
  • Are we lean in our approach? Do we include activities, such as careful and extensive documentation, that we could and should cut back?
  • Can we audit faster, using fewer resources?
  • Do we have the people capable of doing sufficient work to reach an opinion at speed?
  • Do we know how to stop when we have done enough and accelerate when we have not?
  • Are we timely in sharing our assessments and insights?
  • Are we agile?

Every CAE and audit management team should be asking these and similar questions – and being prepared to change.

Nobody likes change, especially if you might be giving up something that has served you well in the past.

But now may be the time to embrace it.

Richard Chambers has a short video that I recommend on having an agile mindset.

But while an agile mind is very important, the body has to be able to respond with agility.

If you take a month or more to complete an audit, are you agile?

If it takes you a couple of weeks before you issue the audit report, are you agile?

If your process requires two weeks of planning and such before you even start, are you agile?

If you are leaving many important risks untouched every year, are you sufficiently agile? I am not referring to the size of your budget but your ability to make the best and most efficient use of limited resources.

To quote Richard, are you smart and fast enough in your auditing?

For more on this, read (or re-read):

I welcome your thoughts.

  1. October 5, 2020 at 8:43 PM

    All I can say that a better approach has existed for 20 years now and The IIA, SEC, Stock Exchanges, Big Four, FEI, ISACA, and many others have not changed without notice. Talk about media bias. They should have been great post Enron/Anderson debacle, instead settled for SOX as the solution. Yuck! That’s why I choose a better path. Not safety, but peace of mind doing the right thing each morning when I wake up and take on the day. Is this your feeling?

  2. Steve Umeme
    October 6, 2020 at 1:11 AM

    Do we know how to stop when we have done enough and accelerate when we have not?
    This to me defines the ultimate test of agility. Adaptation is key. The CAE should be a critical thinker and the BARC support also crucial.

  3. Okurapa Samuel
    October 8, 2020 at 6:08 AM

    Agility in audit,should we be talking about faster implementation of audits in faster changing environments? i believe Agile implementation of internal audit programs may be lacking in resolutions.Hence not covering emerging risks? Risk assessments unless faster than the timing of emerging risks is rendered impracticable especially in technology companies.

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