Internal auditors are developing at least a baseline capability in the still-emerging area of data analytics, with most departments using the high-tech tools or at least making plans to do so.
The latest survey by Protiviti of more than 900 internal audit professionals mostly in the United States found 66 percent who said they work in departments that currently use data analytics in the audit process. Of those that said they did not use analytics, three-quarters said their departments plan to utilize data analytics in the audit process in the next year or two.
While internal audit uptake in analytics is increasing, there’s still plenty of room for growth, the survey data show. Only 16 percent said their internal audit department has a dedicated data analytics function, and only 10 percent said their data analytics functionality is optimized or quantitatively managed in accordance with agreed-upon metrics. In organizations where data analytics are used, nearly three-quarters of internal auditors said demand for data analytics services from within the organization has increased somewhat or significantly.
The primary purpose for data analytics where they are used is in executing and planning audit activity, the poll showed. Three quarters of internal auditors said they use the tools for testing entire populations of data rather than reliance on traditional sampling. Two-thirds said they use the tools to select samples. A little more than half of internal auditors said they see analytics used to support fraud investigations, and a little less than half said they see use for activities like continuous monitoring, continuous auditing, and risk assessments.
The survey data also suggest that where organizations are using data analytics, they are seeing value from their investment. Organizations that are on the more mature end in terms of their use of analytics provide higher value ratings to the use of analytics than do organizations that are still just out of the starting gates.
“The bottom line is that analytics in the internal profession is the future,” said Brian Christensen, executive vice president and global internal audit leader at Protiviti. “Organizations are eager and anxious to go down that path.” A recognition of the benefits of data analytics grows, he expects to see chief audit executives work more closely with boards and management to invest in greater use and capability.