Internal auditing is changing dynamically as organizations experience new trends in governance, risk, and compliance. With the advancement of technology, internal auditors have been called on to tasks that are broader than compliance. Today it is an important element in maintaining organizational reputations, enhancing operational performance, and providing risk insights. Dr. Sabine Charles and her team at Charles Financial Strategies LLC offer expert guidance in navigating these evolving trends, ensuring your organization stays ahead in achieving compliance and operational excellence. Here are some of the key trends seen in the internal auditing industry:

1. Adoption of Advanced Technologies

Technologies like artificial intelligence (AI), machine learning (ML), and robotic process automation (RPA) are transforming internal auditing. Deloitte’s 2024 report shows 40% of organizations have adopted automation in their auditing processes. Through the integration of AI and RPA, auditors are in a position to analyze a large data set, identify risky data points, and alert where necessary in real time, thereby enhancing the agility of auditing.

Consequently, internal auditors have adopted data analytics for continuous monitoring when the data volumes rise. According to the recent Institute of Internal Auditors (IIA) survey conducted in 2023, 67% of the audit functions incorporate data analytics, and this practice is predicted to increase.

2. Increased Focus on Cybersecurity and Data Privacy

Internal auditors must pay due attention to cybersecurity since now there are increased cyber threats and high standards of data protection. A survey conducted by Protiviti in 2023 revealed that 75% of the CAEs identified cybersecurity risk as a key emerging risk. It means that auditors are supposed to design and implement clear controls and measures to minimize cybersecurity threats and secure personal data.

In addition, regulations like the General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA) require auditors to stay current on compliance rules, adding to the demand for auditors with expertise in cybersecurity and privacy.

3. Emphasis on ESG Auditing

ESG factors are increasingly evident in strategic organizational management. According to the IIA’s 2024 ESG Risk Survey, 60% of the companies have incorporated ESG-related risks into audit plans. While internal auditors also evaluate ESG endeavors, they have the critical responsibility of determining the adequacy of ESG compliance with the set standards and regulations of sustainability.

ESG auditing has become an area of focus because both investors and consumers have imposed demands for transparency, and auditors assist businesses in addressing risks in sustainability and ethics.

4. Remote Auditing and Virtual Collaboration

The COVID-19 pandemic amplified the work-from-home models affecting internal auditing. PwC’s 2024 internal audit trends report shows that 56 percent of the companies are anticipating to continue working in remote or hybrid models as some in-person activities start anew.

Remote auditing is useful when the work can be done across different locations and over the Internet so that a lot of time and money spent on travel is saved. However, the auditors bear the new challenges in carrying out virtual communication, accessing digital data, and managing their work in an efficient and effective manner.

5. Broader Strategic Involvement

Internal auditors are more and more perceived in a strategic way. In a survey conducted by KPMG in 2023, 58% of the top management executives have considered internal audits essential for strategic management. Auditors are involved in working closely with different departments in the organization to provide tools and recommendations that are valuable and create positive changes in various operations or risk assessments.

Being experts in the organization structure, they are capable of evaluating the risks as well as the emerging inefficiencies in business and acting as strategists for change within the business environment.

Conclusion

The trends that will shape internal auditing in the future include technology adoption, cybersecurity threats, ESG responsibilities, remote working, and more strategic roles than before. Auditors must also stay on their toes since these trends are dynamic, with the need to update their skills often. The organizations that adapt to these changes and update their audit operations will be able to cope with the threats and be compliant while avoiding the sustenance of unsustainable practices.

By being aware of the latest trends and incorporating new technological advancements, internal audits will have a significant function of delivering valuable information and safeguarding and creating value in the organization in the context of changing business environments. Dr. Sabine Charles and the team at Charles Financial Strategies LLC provide expert guidance to help organizations stay ahead, ensuring their audit operations are future-ready and impactful.

Sources:

· Deloitte (2024). Internal Audit Trends Report

· Institute of Internal Auditors (2023). Data Analytics in Internal Audit

· Protiviti (2023). Cybersecurity Concerns for Internal Audit

· PwC (2024). Internal Audit Remote Work Trends

· KPMG (2023). Strategic Involvement of Internal Audit

· IIA (2024). ESG Risk Survey

The Future of Internal Auditing: Emerging Trends and Challenges