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Random Thought – The Future of Internal Audit April 7, 2011

Posted by Audit Monkey in The Joy & Pain of Internal Audit.
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Well, this isn’t a random thought at all as I’ve been thinking about it a lot.  What are your thoughts on the future of Internal Audit and Internal Auditors?  My thoughts are that the profession, such that it is, is under threat.  It’s being chased down on two fronts, the Risk Boyz and the Compliance Wallars.  Briefly, here’s why. 

The Risk Boyz have created a Risk Utopia where every firm has to have a risk officer and framework to analyse, er, risk.  Most firms do this pretty miserably as one, they can’t bothered, two, it costs money whereas they would rather be making money and third, no-one isn’t that interested in it – c’mon, do you really want to be a Risk Officer?

As for the Compliance Wallars, I am beginning to think that they are slightly more favoured than Internal Auditors as they keep firms out of the public eye by ensuring the Regs are adhered to so everyone can sleep at night, safe in the knowledge no sanction from the Regulator is coming their way.

And what about the Internal Audit fellas?  A bit of ticking and bashing here, a bit of ticking and bashing there? C’mon, what does it really achieve especially when firms must not have skeletons in the cupboard hiding from the Regulator? And second, the more specialist auditing is around IT, modelling and derivative products.

Answers please…

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Comments»

1. ITauditSecurity - April 9, 2011

I think it depends on 2 things, company by company: 1) whether the company wants to really know their risk, or just get by, and 2) the quality of the work done by their current auditors.

Companies that truly care about risk and have decent auditors who don’t nitpick will continue to use auditors. Companies that just want to get by will use the cheapest and easiest folks available who will do their biding.

Overall, I think we’re heading for more regulation, not less, so I think auditing will survive, especially since auditors have real frameworks behind them with the audit organizations like IIA and ISACA. What are compliance junkies going to lean on? And when they lean on the audit frameworks, they’ll eventually be moving over to the audit side.

As much as I hate the phrase, ADD VALUE, we must continue (or start, for some of you!) to do just that or we are all doomed.

2. Audit Monkey - April 9, 2011

Interesting. I have the other view, Audit will be moving towards the Compliance world.

3. Robin Singh - August 24, 2011

Well, Audit as a profession will never die out. The mother of compliance, risk originated from audit. So Audit will get specialised and streamlined. If you look at forensic, it is a new science but somewhere has its roots deep down to Audit.

4. Audit Monkey - August 25, 2011

True – the profession will not die out but even in the past week, controls over data integrity are increasingly important rather than if the bank reconciliation has been independently reviewed.


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