You've come a long way, baby: 20 years of transformation in internal audit

Protiviti, a Menlo Park, CA-based consulting firm, has released the 20th edition of its "Internal Auditing Around the World" report.

This year’s report – “Exploring a Universe of Experience as a Launchpad to the Future” – examines how internal audit has changed in the past two decades. The analysis utilized Protiviti’s proprietary GenAI tool to help identify themes and trends in the past 19 volumes – which include 244 profiles of leading internal audit functions.

“Internal audit leaders must be bold, willing to explore and expand into new frontiers — serving as a guiding star, steering organizations toward a resilient and adaptive future," said Andrew Struthers-Kennedy, global leader of Protiviti's internal audit and financial advisory practice.

The report highlighted several trends in the evolution of internal audit functions.

First, the function has changed from compliance-focused and backward-looking to one that is strategically aligned and value-adding to the organization. As such, the internal audit department has shifted from a sole focus on compliance and controls to a wide-ranging mix of assurance advisory services.

Furthermore, boards have come to rely on beefed-up internal audit teams for advice on risk areas beyond compliance – including cyber, fraud, new tech adoption, market expansion, and sustainability.

Internal audit teams have also become more diverse in their backgrounds and capabilities, while being modernized through the adoption of technologies such as automation and AI.

Last, leading internal audit teams act as change drivers, providing insights to spur organizational improvement, seize opportunities, and minimize downside risk.

Protiviti’s report also outlined five strategies to elevate internal audit functions. These are: prioritizing transformation, leaning on technology, cultivating talent, adopting an innovation mindset, and acting as a strategic partner through collaboration and communication.