The COVID-19 pandemic has brought about a paradigm shift in the way we perceive our world and will have a lasting impact on the economy, people and consequently redefining the world order.
We believe that these challenging times can act as catalyst for new strategies, approaches and use of innovative technologies in our work places. Innovation and collaboration would be the key for unlocking the future across all business verticals. The Internal Audit & Compliance functions will have to adapt to competitive innovation and increased usage of technology for identifying and responding to the ever changing risk landscape and business needs.
Over 600 participants joined our third “Enterprise & Market Resilience COVID-19 India Forum” on Internal Audit’s response, challenges and imperatives in the COVID scenario. A virtual roundtable, hosted under Chatham House rules that facilitated an informative discussion, enabling participants to ask questions during the session.
- Introspect the change and adopt the ‘new norm’ by realigning the business operations/ processes for sustainable transformation and growth.
- Continuous assessment of the current ecosystem and the risk environment and refreshing of the audit plans for managing risks posed by the crisis and its aftermath.
- Enhance usage of technology and digital tools such as data mining, artificial intelligence for audits to make more meaningful and insightful contributions to business.
- Focus deeper on data driven auditing techniques to provide cost effective solutions.
- Encourage teams to become more agile and flexible.
- Adoption of digital technologies may require new skills or significant efforts to upskill/ reskill existing employees for successful performance.
- Collaboration, inclusiveness, flexibility and relationship building along with effective communication will be the key drivers for internal audit professionals to keep up with the business demands.
The stage was set as the moderator summarized how the current crisis adversely impacted the global economy and how companies were witnessing a paradigm shift in the ways of doing business, at the same time managing risks by conducting audit engagements/ reviews. Nonetheless, the crisis has also unfolded multifold opportunities for organizations and employees to innovate, collaborate and fast track adoption of change for achievement of the strategic and business objectives.
Message for Internal Auditors
The Group Audit Executive of a large insurance company spoke about how for the first time they observed that 100% of audits can be done remotely and how this was truly based on the fundamentals of trust, equality and commitment.
The Group Head of Audit & Risk Management of a fortune 500 oil & gas major mentioned about how businesses were relying on the emerging technologies to identify the high risk areas, plan the audits and facilitate real-time collaboration between the cross-functional teams and third – parties.
An Independent Director serving on the boards of several reputed companies emphasized on one of the foremost need of the hour for auditors i.e. graduating from the traditional ways of conducting audits to using data science and data based audits. He reiterated how the crisis is a great opportunity for professionals to introspect, assess and implement new ideas.
Managing Risks & Challenges in the COVID Environment
The Internal Audit department needs to remain strong and resilient. As panelist highlighted how the IA department had devised strategy to leverage use of technology while addressing key risks and challenges and also providing the necessary levels of assurance to business for maximizing outcomes.
Investing early in developing science based auditing tools and digital platforms must become a cornerstone of organizational strategy. Collaboration with third parties and stakeholders can further help devise better approaches to managing group level risks.
Panelists concurred on the view that the ability for internal audit function/ professionals to remain relevant and address the needs of the business and clients is incumbent upon up skilling, leveraging new tools and techniques, including agile auditing.
Digital Enablement – A Perspective on Innovation
Digital enablement and transformation is a journey and organizations evolve over a period of time to attain maturity. It requires a change in the mind-set and culture within the organization and transformation can only happen if ideas are promoted across levels.
Digital enablement emanates from the strategic intent of an organization and alignment of various systems and processes, which is a prerequisite for data to be meaningfully used by audit and business. Although the challenge of system integration and use of data in an effective manner remains to be resolved.
Control dashboards and deficiency dashboards need to be aligned with business dashboard objectives and organizations ought move from just audit assurance to providing business assurance.
Managing Risks of Working from Home
Panelists were unanimous that the rapid shift to remote employee working arrangements has emerged as a major trend and could become the new norm for how we operate and manage our businesses going forward. This requires secured IT environment, including strengthening of the security architecture and use of digital platforms to reduce and eliminate the risk of unauthorized access, misuse of data and theft. It is imperative for organizations to set up secured IT environments and embark upon the journey of digitization, innovation and automation at a faster pace.
- Imbibing the spirit of innovation, collaboration and integration
- Use of technology and data science in audits
- Aligning business success with the well-being of people
- Promoting employee flexibility and accountability
- Building relationships in digital/ virtual environment