Internal audit of the future: team selection

How future internal audit team selection will be critical to success

Getting the people, process and technology right for any internal audit function is a fine balancing act, one that is complicated by a business environment that refuses to stand still. What worked last year might be unbalanced by next year, and totally out of kilter further down the line. In five years, it could look completely different.

However, amid this uncertainty, we will see in the coming years a significant shift in the skills pyramid within the internal audit team, with greater emphasis now placed on new and more specialised skills and experience. The pyramid will be turned on its head as IA requires greater experience with broader and deeper expertise at senior levels.

At the same time, we will see routine tasks replaced with robotic process automation – yes, the robots are coming, but they will not be putting internal auditors out of a job. Instead, there will be greater opportunities to provide valued adding business advice as business partners to the wider enterprise.

The use of RPA and data analytic tools will free up time for higher grade advisory work. This will lead to a wholesale skillset shift, one that will move internal auditors higher up the skills curve at greater speed. It will also see skills being brought in from around the organisation and outside as well.

1. New team, new skills: 1

Traditional skills for internal auditors include accounting, compliance, fraud, and finance. While these skills remain vitally important today and more so tomorrow, for many organisations in the future these will not be enough.

In the constantly transforming business environment, many organisations are already looking for internal auditors with expertise in technical areas like data science, analytics, IT, cybersecurity, and privacy – GDPR alone presents many risks which were unknown just a few years ago.

This shift will require investment, both in terms of new talent and upskilling of existing members of the team. So, in addition to hiring professionals with specialised knowledge, companies will also invest in current employees, expanding their skills and expertise through training in these areas.

The seniority of talent will also shift further along the curve, reflecting the additional skills and experience that IA teams will need in the future. This will enhance the profile and influence of the team within the organisation.

2. New team, new skills: 2

In keeping with new ways of working and the increasing need for agile responses to changing demands, in the future, internal audit team members will be drawn increasingly from across the organisation. Secondments will be used to provide particular skills for particular tasks. This will have the dual impact of enhancing the overall skillset of the IA team while also exposing talent around the organisation to the important role that IA plays in protecting the organisation.

This will become a two-way street, where members of the IA team are able to join other areas of the organisation to acquire new skills which can be brought back to IA. This will help to break down silos and allow for mutual understanding of different roles in different divisions, and most importantly, an opportunity to further understand how risk manifests itself across the organisation.

3. New ways of working: 1

Agility and fluidity will be the new norms for working across the organisation. Accelerated by the pandemic, remote working will create risks and opportunities. Flexible working arrangements will widen the talent pool within which IA can recruit, but will also present mentoring and coaching challenges – the smart IA team of the future will ensure that learning opportunities are not missed and that communication within the team is not just maintained, but enhanced, to ensure the whole team is integrated and thinking as one.

4. New ways of working: 2

Co-sourcing the IA function will become more prevalent in the coming years – this could be in response to greater regulatory requirements that require certain skills to be brought in on an ad hoc basis, or to proactively provide greater flexibility and the ability to identify and rectify particular risks at any given moment. In-house and outsourced teams will operate as one, each being able to deliver relevant expertise and knowledge of the organisation.

This is a snapshot of the future of internal audit – there will be challenges for the team but also great opportunities, many of which are happening now.