The Institute of Internal Auditors has published a new guide intended to help internal auditors who may be entrenched in manual audit methods to adopt more technology-driven data analysis.
The guide explains to internal auditors why data analysis is significant to companies and how it can provide assurance more efficiently than traditional manual methods. It addresses the challenges and risks companies likely will face when implementing data analysis technology, and it explains how to incorporate data analysis technology by deploying adequate planning and appropriate resources.
It also describes how internal auditors can identify opportunities for making greater use of data analysis technology. “Data analysis skills are essential for auditors today,” says Terri Freeman, director of professional practices for the IIA. “Technology can help auditors to be more effective and more efficient.”
To illustrate the benefits, the guide includes a detailed example of how data analytics might be applied to procurement control activities. The examples are focused primarily on simple data matching and re-performance of automated system functionality used in providing assurance.
Freeman said the use of technology to perform data analysis is particularly beneficial in compliance-type auditing. It more efficiently and effectively calls attention to anomalies that might suggest a company is not in compliance with any number of rules or regulations. “Technology enables you to look at the universe of data and see things you wouldn't normally look for,” she says.
In many shops, internal auditors today are still relying on pulling paper documents, such as invoices, and testing a sample, she says. “If you bring that data into a system, you take in the universe of data, not just a sample of it,” she says.
No comments yet