Agile Organization

7 Ways Internal Auditing Might Become Agile

Agile is kind of becoming the new salt (Splenda?). People want to sprinkle a little of it on everything and see what happens. In an article for Forbes, Steve Denning considers the applications of agile for internal auditing. He examines recent research by PricewaterhouseCoopers (PwC) and shares seven keys for agile internal auditing:

  1. Active and broader involvement in disruption
  2. Being prepared and adaptive
  3. Assessing the risk of future disruption
  4. Proactive involvement in disruptive events
  5. Flexible talent management
  6. Flexible planning
  7. Meaningful collaboration with other lines of defense

Auditing at a Crossroads

According to PwC, stakeholders who have found internal audit to add significant value dropped to 44 percent in 2017 compared to 54 percent in 2016, which is the lowest number seen in the five years that PwC has been tracking it. One reason why is that internal audit as a means of compliance just not jive so well with the spirit of constant disruption overtaking many businesses. Hence, the above keys come into play.

Denning draws upon various quotes from PwC to back up these ideas. Here is what he has to say about flexible planning:

The Agile pioneers in internal audit recognize the need to “build the eventuality of disruption into planning and risk assessment. It’s impossible to identify all potential business disruptions, but one can be fairly certain that at least some will occur during the course of each year. Agile internal audit functions plan for this and create flexibility in their planning and resource allocation that enables them to address disruptive events when they happen.” Some “73% of Agile internal audit functions change course and evaluate risk at the speed required by the business (vs. 37% of peers)[.]”

For a longer discussion, you can view the original article here: https://www.forbes.com/sites/stevedenning/2017/03/21/can-internal-auditing-become-agile-seven-keys-to-thinking-the-unthinkable/

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