> Unlocking the value of Internal Audit - Three steps to transformation
Internal Audit can provide strategic insights that improve business performance.
In recent years, Internal Audit has been focused on control and compliance efforts to address internal control requirements. Now senior executives and audit committees are looking for more.
Executives and audit committee members want to broaden the role of Internal Audit beyond reliable assurance and efficient audits.
They want to be able to turn to Internal Audit for:
Subject matter expertise
Business insights into strategic initiatives
Ideas that challenge existing practices and lead to ongoing business performance improvements
It’s about finding the right balance among risk, cost and value.
With it, Internal Audit can become an internal beacon for change across the organization.
Internal Audit is understood as important role, but does it help achieve business goals?
Ernst & Young commissioned Forbes Insights to conduct a global survey about the evolving role of Internal Audit.
In the survey, 96% of respondents indicate that their Internal Audit function has an important role to play in their overall risk management efforts. And yet, 74% believe that there is room for improvement, and nearly every respondent seeking improvement believes that they should be undertaken within the next 12 to 24 months.
Only 44% of respondents believe that Internal Audit is helping their organization achieve its business objectives. And fewer — 37% — say they involve Internal Audit in key business decisions and strategy.
Internal Audit’s evolving role
Internal Audit: your strategic advisor
By looking beyond processes and controls, Internal Audit can play an essential advisory role within the organization. It can:
Identify enterprise-wide cost efficiencies
Offer strategic insights that improve business performance
Provide a key perspective that focuses on the risks that matter
This support can help Internal Audit be more efficient and enable it to move quickly when opportunities arise.
For Internal Audit to realize this transformation, it needs to:
Align itself with the organization’s key business objectives
Improve audit efficiency and effectiveness
Offer broader risk coverage
Enable cost efficiencies across all business units
Identify and employ the right internal and external skills
Contribute to sustainable business improvements
Given that a majority of corporate leaders will be pushing to enhance their audit function in the next two years or less, Internal Audit has the opportunity to move quickly in driving competitive value across the enterprise.
Ernst & Young refers to the global organization of member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.