Report: Audit Industry Rising to the Data Analytics Challenge

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With businesses facing the strongest economic headwinds in years, the Chartered Institute of Internal Auditors (Chartered IIA) is urging internal auditors to embrace data analytics to navigate more risky, uncertain, and volatile times ahead. 

The new report, “Embracing data analytics: Ensuring internal audit’s relevance in a data-led world,” from Chartered IIA in partnership with AuditBoard highlights:

  • 60% of internal audit functions already use some form of data analytics, and an additional 7% have advanced to AI.
  •  The top three risk areas for using data analytics are financial (62%), fraud (17%), and legal and compliance (6%).
  •  The top three barriers to fully embracing data analytics include lack of skills (49%), lack of resources (24%), and lack of time to implement (12%).

Data analytics’ benefits include greater assurance, audit coverage, and enhanced efficiency.

This report aims to encourage internal audit to fully embrace data analytics and support the organization in doing the same. Data-empowered senior management are more risk aware and can make smarter, swifter decisions. For internal audit, data analytics enables faster assurance and more incisive insights for the organization to act on. The case for adopting a data-led approach has never been more urgent.

To explore how the profession is progressing in its use of data analytics and AI/machine learning, the Chartered Institute of Internal Auditors hosted three roundtable discussions in August 2022 on the topic, in which members shared their insights and experiences. Building on this, they sat down with senior internal audit executives at three organizations that have either demonstrated instructive progress in their data analytics journeys or are applying these techniques at an advanced level.

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