UAE organizations are keen to see Internal Audit evolve from a support function to a strategic one: KPMG survey
Source: KPMG , Author: Posted by BI-ME staff
Posted: Thu December 14, 2017 11:23 am

UAE. The scope for Internal Audit (IA) responsibilities has expanded beyond traditional compliance and financial reporting, and now encompasses identifying emerging risks and facilitating the implementation of enterprise risk management (ERM), according to the 2017 UAE Internal Audit survey – a joint initiative between the UAE Internal Auditors Association (UAE IAA) and KPMG.

The findings of the survey suggest that Chief Financial Officers (CFOs), heads of Internal Audit and audit committee chairpersons believe there is significant scope to have the IA play a more strategic role within organizations.

For internal auditors to be considered as strategic partners, the respondents suggested that an organization’s management should devise ways for the IA department within a firm to gain more maturity and better understand the business. Ideally, this department should be in a position to identify business opportunities and risks, while also contributing to improving processes, controls and compliance.

The IA activity also has the ability to achieve greater efficiency by leveraging the latest technological tools for continuous auditing and monitoring. While continuous auditing may assist auditors as they analyze data for early identification of outliers or risks, continuous monitoring can further enable the management team to assess the business against key performance metrics.

Nearly 5 out of 10 interviewees across both groups of respondents (IA professionals and executive stakeholders) stated they had already started implementing analytics within their respective organizations. This leaves ample scope for technology adoption and implementation.

With risk assessment being one of the most critical aspects of the internal audit activity, it was considered essential that internal audit and risk-management teams work together to protect an organization from potential threats and ensure it maximizes its growth potential at every stage.

The survey also reveals that more than half of UAE-based executive stakeholders and an even higher proportion of IA professionals (70 per cent) would rather rely on internal audit than on third-party resources to provide insights into strategic, operational, legal and regulatory, and financial risk coverage.

The co-sourcing model is gaining popularity in the UAE and globally, though an accurate assessment of size, complexity and needs of a particular organization should be conducted before choosing the most suitable model.

The survey found that an increasingly regulated and complex business environment has highlighted the desire for a more effective IA department, bolstered by strong IA leadership, skilled resources, adoption of industry-standard frameworks, and the increased use of enablement tools offered by emerging technologies.


About KPMG International
KPMG is a global network of professional services firms providing audit, tax, and advisory services. KPMG operates in 152 countries and has 189,000 people working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. Each KPMG firm is a legally distinct and separate entity and describes itself as such.

 

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