Enhancing the strategic value of Internal Audit | KPMG | CA

Enhancing the strategic value of Internal Audit

Enhancing the strategic value of Internal Audit

How Internal Auditors can enhance their strategic value that executives are looking for.

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Enhancing the strategic value of Internal Audit

Is Internal Audit (IA) best described as a “strategic” or “support” function for your organization? According to our survey report, business executives clearly want Internal Auditors to play a more strategic role, and it’s up to IA to rise to the occasion.

Heeding the call

Comparing our previous survey in 2015, where we found ‘value gaps’ between what Chief Financial Officers (CFO) and Audit Committee chairmen (ACC) identify as priorities and what they are receiving from their IA functions. Our recent survey suggests that CFOs and ACCs envisage a more strategic role for Internal Auditors than the auditors see for themselves, and it is up to the auditors to take the initiative and broaden their responsibilities.

When respondents were asked whether IA is a strategic or a support function, 99 percent of executive stakeholders say it is strategic, compared with only 60 percent of auditors – which suggests that a strategic role is more aspirational than actual.

Bridging the gap

In almost all cases, Internal Auditors and executive stakeholders do not agree on the most important attributes of IA. Internal Auditors believe an insightful and valuable internal audit examines efficiency and effectiveness; meanwhile, 82 percent of executives view ‘value’ in a more tangible term, that a valuable audit is one that finds potential revenue enhancement, cost savings and/or smarter capital expenditures.

Three key implications

For Internal Auditors to meet (or exceed) executives’ raised expectations, three important things need to happen:

  1. They must become more deeply involved in business matters, and not just in dealing with questions about processes, controls and compliance.
  2. They need to do more to leverage technology, not just to help increase efficiency but also to improve the quality and depth of the insights being delivered to the business.
  3. They need to view their activities through the lens of business value.

This transformation is a chance for both IA and the organization it serves to achieve a higher level of performance.

Download our report for more findings and contact us to discuss how we can assist you in adding value to your Internal Audit.

Seeking value through Internal Audit

Seeking value through Internal Audit

What organizations can do to elevate the value of their internal audit function and create a new standard of delivery.

Internal Audit, Risk & Compliance Services

Internal Audit, Risk & Compliance Services

Providing strategic sourcing of internal audit; continuous auditing/monitoring; ERM; governance and regulatory compliance.

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