The Accounting Profession Must Embrace Technological Change and Expand Advisory Services to Thrive

Navigating the Future of Internal Audit: Embracing Technology and Expanding Advisory Services

Internal Audit Profession Faces Technological Transformation and Strategic Evolution

Results from the latest Vision report from the Institute of Internal Audits and the Internal Audit Foundation have revealed the significant impact that technological change will continue to have on the internal audit profession. Based on feedback from over 7,000 practitioners and stakeholders worldwide, the report, titled “Internal Audit: Vision 2035 – Creating Our Future Together,” highlights the need for internal audit practitioners to adapt to emerging technology in order to provide value to organizations in the years to come.

The report identified several positive changes driven by technology that are expected to transform internal audit in the next decade. Participants overwhelmingly agreed that technology will increase the complexity and volume of data available for analysis, as well as enable audit functions to develop better insights for recommendations to stakeholders. While AI is seen as a tool for deeper insights, only 48% of respondents reported involvement in AI-related activities.

Anthony Pugliese, President and CEO of The Institute of Internal Auditors, emphasized the importance of embracing technology to optimize operations and expand capabilities. He stated, “Internal audit must rapidly transform or risk becoming irrelevant to stakeholders. Leveraging new technology to provide strategic, actionable insights will enable practitioners to proactively help organizations stay ahead of emerging trends and risks.”

In addition to technological changes, the report also highlighted the increasing need for internal audit functions to expand their services and take on a more strategic advisory role within organizations. Participants agreed that advisory work will become essential to audit functions in the future, with operations, compliance, and risk management identified as key areas for providing assurance and advisory services.

Warren Stippich, Jr., President of the Internal Audit Foundation, emphasized the importance of internal audit functions being versatile and agile to meet stakeholder expectations. He stated, “The profession needs internal audit functions to pivot to provide support through an advisory lens while accomplishing the basic objectives of annual internal audit plans.”

The report also addressed challenges facing the internal audit profession, including the need to preserve independence and objectivity, shift public and stakeholder perceptions, and grow the talent pipeline. Half of respondents cited being misunderstood or undervalued as the greatest challenge, while a significant percentage highlighted the need for more support from leadership and stakeholders.

Pugliese emphasized the importance of increasing awareness of the value of internal audit and providing opportunities for students and young professionals to explore it as a career path. He stated, “Prioritizing the talent pipeline is crucial as we move toward achieving the profession’s envisioned future.”

Overall, the Vision report underscores the need for internal audit practitioners to adapt to technological changes, expand their services, and embrace a more strategic advisory role to remain relevant and provide value to organizations in the evolving business landscape.