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Internal Audit, Risk, Business & Technology Consulting
Protiviti Perspective provided by Nikhil K., New Delhi
NEXT GENERATION IA – IN PURSUIT OF INNOVATION
© 2019 Protiviti – Confidential. An Equal Opportunity Employer M/F/Disability/Veterans. Protiviti is not licensed or registered as a public accounting firm and does not issue opinions on financial statements or offer attestation services. All registered trademarks are the property of their respective owners.
INTRODUCTIONS
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Managing Director, Protiviti Internal Audit - Technology
Andrew Struthers-Kennedy
Senior Manager, ProtivitiInternal Audit
Jared Bourcier
Image Image
© 2019 Protiviti – Confidential. An Equal Opportunity Employer M/F/Disability/Veterans. Protiviti is not licensed or registered as a public accounting firm and does not issue opinions on financial statements or offer attestation services. All registered trademarks are the property of their respective owners.
SESSION TOPICS
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2
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Innovation in Internal Audit – Why & How?
Components of Next Gen
Emerging Technologies and Approaches
© 2019 Protiviti – Confidential. An Equal Opportunity Employer M/F/Disability/Veterans. Protiviti is not licensed or registered as a public accounting firm and does not issue opinions on financial statements or offer attestation services. All registered trademarks are the property of their respective owners.
THE CHALLENGE…
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Is IA using enterprise data efficiently to conduct risk assessments and continuous monitoring?
Has IA added resources and skill sets to address increased expectations from stakeholders?
Has IA started to increase use of technology to enhance the internal audit function?
Is IA still performing (and reporting) audits and reviews in the same way as in years past?
Is IA positioned to respond to changing key business risks associated with digital transformation initiatives?
© 2019 Protiviti – Confidential. An Equal Opportunity Employer M/F/Disability/Veterans. Protiviti is not licensed or registered as a public accounting firm and does not issue opinions on financial statements or offer attestation services. All registered trademarks are the property of their respective owners.
ESSENTIAL OBJECTIONS OF NEXT GEN IA
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A range of innovative approaches, tools and governance enablers, including a culture of innovation to…
Improve assurance by increasing the focus on key risks… in time1
Make internal audit more efficient2
Provide deeper and more valuable insights3
© 2019 Protiviti – Confidential. An Equal Opportunity Employer M/F/Disability/Veterans. Protiviti is not licensed or registered as a public accounting firm and does not issue opinions on financial statements or offer attestation services. All registered trademarks are the property of their respective owners.
NEXT GENERATION INTERNAL AUDITCompetencies, qualities and components to effect change
Next Generation
Internal Audit
IA Strategic Vision
Resource & Talent Management
Aligned AssuranceAdvanced Analytics
Process Mining
Machine Learning (ML) Artificial Intelligence (AI)
Continuous Auditing Dynamic Risk Assessment
High Impact Reporting Agile Audit Approach
Robotic Process Automation (RPA)
Organizational StructureNext-
Generation Internal Audit
AUTOMATION IN AUDIT
© 2019 Protiviti – Confidential. An Equal Opportunity Employer M/F/Disability/Veterans. Protiviti is not licensed or registered as a public accounting firm and does not issue opinions on financial statements or offer attestation services. All registered trademarks are the property of their respective owners.
AUTOMATE EVERYTHING?
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• Brainstorm candidates• Evaluate for technical feasibility and business value• Prioritize automation opportunities• Evaluate through POC… prove what’s possible• Scale
Follow a disciplined approach to automation…
© 2019 Protiviti – Confidential. An Equal Opportunity Employer M/F/Disability/Veterans. Protiviti is not licensed or registered as a public accounting firm and does not issue opinions on financial statements or offer attestation services. All registered trademarks are the property of their respective owners.
PURSUING RPA… HOW TO STARTOpportunityAssessment
InitiateProgram
Pilot Deployment
Proof of Concept
Deploy, Operate & Monitor
Roadmap
Identify automation candidates and completing a Proof of Concept…
© 2019 Protiviti – Confidential. An Equal Opportunity Employer M/F/Disability/Veterans. Protiviti is not licensed or registered as a public accounting firm and does not issue opinions on financial statements or offer attestation services. All registered trademarks are the property of their respective owners.10
USE CASES FOR INTERNAL AUDIT
Testing Artifact Gathering
Admin / PMO / eGRCControl Activities
© 2019 Protiviti – Confidential. An Equal Opportunity Employer M/F/Disability/Veterans. Protiviti is not licensed or registered as a public accounting firm and does not issue opinions on financial statements or offer attestation services. All registered trademarks are the property of their respective owners.
RPA IN ACTION…
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RPA In Action
AGILE FOR INTERNAL AUDIT
© 2019 Protiviti – Confidential. An Equal Opportunity Employer M/F/Disability/Veterans. Protiviti is not licensed or registered as a public accounting firm and does not issue opinions on financial statements or offer attestation services. All registered trademarks are the property of their respective owners.
AGILE AUDIT… WHAT AND WHY?
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Product Backlog
A
B
C
F
Sprint Backlog
D.1
D.2
D.3
D.4
Sprint Planning
Daily Scrum
SprintSprint
Deliverable
E.1
E.2
Sprint Review&
Retrospective
IA DeliverableD.5
Product and Sprint Backlogs (Risk Aresa) Drive Work
Real Time Deliverables and Feedback
Iterative and Incremental Fieldwork / Testing
Plan Work Review
© 2019 Protiviti – Confidential. An Equal Opportunity Employer M/F/Disability/Veterans. Protiviti is not licensed or registered as a public accounting firm and does not issue opinions on financial statements or offer attestation services. All registered trademarks are the property of their respective owners.
AGILE AUDIT… WHAT AND WHY?
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Source: Protiviti 2019 Internal Audit Capabilities and Needs Survey
© 2019 Protiviti – Confidential. An Equal Opportunity Employer M/F/Disability/Veterans. Protiviti is not licensed or registered as a public accounting firm and does not issue opinions on financial statements or offer attestation services. All registered trademarks are the property of their respective owners.
AGILE FOR AUDIT?
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• Our POV… focus on delivering quality product faster and more efficiently, with improved stakeholder engagement
• Instill an agile mindset and empower personnel to innovate and find way to do things better
Broad Range of Definitions for Agile in IA…
© 2019 Protiviti – Confidential. An Equal Opportunity Employer M/F/Disability/Veterans. Protiviti is not licensed or registered as a public accounting firm and does not issue opinions on financial statements or offer attestation services. All registered trademarks are the property of their respective owners.
EXAMPLES OF AGILE IA
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Focus on Benefits vs. Strict AdoptionMore focused “sprint-like” delivery of
audits – shortening time-to-report
An iterative “follow-the-risk” type approach to audit delivery
Iterative, high-touch, and flexible reporting process
Integrated (cross-functional) teams formed into “pods” delivering a series
of audits (backlog)Increased involvement of IA and
business leadership (standup and sprint review meetings)
Audits broken down into sprints with focus of delivery of results and direct
feed into reporting
Emphasis on data gathering in advance of project
PROCESS MINING
© 2019 Protiviti – Confidential. An Equal Opportunity Employer M/F/Disability/Veterans. Protiviti is not licensed or registered as a public accounting firm and does not issue opinions on financial statements or offer attestation services. All registered trademarks are the property of their respective owners.
PROCESS MINING FOR AUDIT INSIGHT
© 2019 Protiviti – Confidential. An Equal Opportunity Employer M/F/Disability/Veterans. Protiviti is not licensed or registered as a public accounting firm and does not issue opinions on financial statements or offer attestation services. All registered trademarks are the property of their respective owners.
PROCESS MINING DEMO
Uses data from enterprise systems to visually reconstruct how processes actually perform… what is actually happening, creating a
complete process map
INTERNAL AUDIT TOOLKIT
© 2019 Protiviti – Confidential. An Equal Opportunity Employer M/F/Disability/Veterans. Protiviti is not licensed or registered as a public accounting firm and does not issue opinions on financial statements or offer attestation services. All registered trademarks are the property of their respective owners.
THE IA TOOLKIT
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© 2019 Protiviti – Confidential. An Equal Opportunity Employer M/F/Disability/Veterans. Protiviti is not licensed or registered as a public accounting firm and does not issue opinions on financial statements or offer attestation services. All registered trademarks are the property of their respective owners.
THOUGHT LEADERSHIP
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Q&A
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