technology ahia 2012 jmk
DESCRIPTION
How Technology Continues to Revolutionize Auditing:The Latest Tools and Their Impact on the Profession presentation for the Association of Healthcare Internal Auditors in 2012TRANSCRIPT
7/12/2013
1
HOW TECHNOLOGY CONTINUES TO REVOLUTIONIZE AUDITING:THE LATEST TOOLS AND THEIR IMPACT ON THE PROFESSION
JIM KAPLAN CIA CFEPRESIDENT AND FOUNDERAUDITNET®
AHIA 31st Annual Conference – August 26-29, 2012 – Philadelphia PA
www.ahia.org
1
Agenda
Introduction
Historical Timeline Internet and Auditors
Technology’s Impact on Audit
Innovation in Audit Research
Evolution of Professional Networking
Latest Technology Tools for Auditors
Trends and the Future of Audit Technology
7/12/2013
2
Then and Now
Auditors and Technology
Early Adopters
Innovators (into the new from Latin
Interested in new methods & techniques
Risk takers
Forward thinking
Gen X & Y
Laggards
Wait and see
Cautious
Hangs back
Last group to try or adopt a new product
Dislike change
7/12/2013
3
Evolution of Web for Audit
Computers, Auditors and CAATTs
The Evolution of CAATTs 80’s Around Through With EDP/IT Auditors Mainframe
Audit Software 90’s Data extraction and analysis IT and non IT Auditors Windows
The Millenium Software for all phases (planning, fieldwork, GRC) Cloud computing
7/12/2013
4
Impact of Technology
Computers and networks provide most of the information needed for auditing
Auditors must use the computer as an auditing tool
Auditors must also use the computer for audit administration
Impact of New Technology on the Profession
Professional Standards 16 Global Technology Audit Guides have been
released since January 2009
7/12/2013
5
New Technologies and their Impact
Mobile computing
The Cloud or Internet based services SaaS (application based) PaaS (end to end SDLC) IaaS (servers, storage, network)
Social Media
Social Media Defined
The good the bad and the ugly
What is the primary risk?
7/12/2013
6
Technology as an Enabler
There is a wide array of specialized tools to support and enhance the entire spectrum of internal audit processes … for the most part (auditors) are not taking advantage of them
Not surprisingly, survey participants predict that
technology will affect internal audit roles and
responsibilities more than any other business
trend.PwC 2010 Study on the State of the internal audit profession
Audit Software
7/12/2013
7
Categories of Audit Software Technology
AutomatedIssues
Tracking
ElectronicWork Papers
RiskAssessment
ContinuousControls
Monitoring
Anti FraudSoftware
GRC
Audit Management
Software
Audit Resource
Scheduling
DataAnalytics
Data Analysis for Auditors
Although internal auditors have been doing data analysis for more than 25 years, it has only recently started to become standard practice.
By our nature, most accountants and auditors are inclined to stick with what has worked in the past, rather than reach outside our comfort zone for an alternative that could help us accomplish more.
Do you reach outside your comfort zone?
7/12/2013
8
Obstacles to Implementation
Lack of an audit methodology Skill set gap Department size Cost implication Complexity of the software Resistance in training auditors Failure of software to meet audit departments needs Failure to plan for use
Heard on the Street
Technology Initiatives considered having the most impact (2012 AICPA Top Technology Issues)
1.Information security2.Remote access3.Control and use of mobile devices4.Business process improvement with technology5.Data retention policies and structure6.Privacy policies and compliance7.Staff and management training8.Spreadsheet management9.Overall data proliferation and control10.Portals (vendor and client/customer)
7/12/2013
9
New Tools for Auditors
New Tools
Sept, 2008…. Any device, Any time, Any
where was born
Users not interested in security, they want to trust, not to be trusted
Any unprotected device connected to both the Internet & and company LAN poses a security risk
7/12/2013
10
Other Technology Tools for Auditors
Open Source Audit Software
Continuous Controls Monitoring
Regulatory Compliance
Business Intelligence Software
Audit Apps for iPhones/iPads
7/12/2013
11
Imagine the Possibilities
Access your computer from remote locations Collaborate using tools from the road Access audit programs, work papers and more
from your mobile device Join Webinars and Webcasts for training Conduct or participate in virtual meetings with
staff, clients etc.
Trends and their Impact
Mobile devices and wireless computing
Smart devices and malware
Cloud sourcing and computing – security, governance and compliance
Social media platform for communications
Continuous risk and control assessment
Reporting to the Board using SOTA technology
7/12/2013
12
Skill Set for Future Auditors
Multi-disciplinary less accountants more business oriented
Critical thinking skills
Strong communication skills
Audit Technology oriented
The Impact of Technology Observations
Not surprisingly, survey participants predict thattechnology will affect internal audit roles andresponsibilities more than any other businesstrend.High-performing internal audit functions maximizethe use of technology to enhance the efficiency,effectiveness, and quality of operations.
PwC 2012 Study on the State of the internal audit profession
7/12/2013
13
AuditNet® Survey - 2012 State of Technology Use by Auditors
Profile of Over 1,500 Responses• 45% 5 or less auditors• Technology tools used – mostly data analytics and
EWP • Technology tools least used – monitoring (continuous
audit and fraud), GRC, risk compliance• Only 17% feel that their auditors are technology
proficient• Technology training primarily OJT• 35% maintain an inventory of audit technology
tools• More than half (54%) rated their department at the
informal use level (ad hoc or none at all) for audit technology
• Less than 4% rated their department at the highest maturity level
AuditNet® 10 Point Action Plan for Integrating Technology in Audit
1. Conduct an inventory of audit technology tools2. Provide training for all staff in use of audit
technology3. Measure staff technology KSA4. Build a business case for audit technology5. Work with IT and Senior Management on cost6. Hire auditors with technology skills7. Find a technology champion and influencer8. Establish an audit technology assessment
benchmark and update annually9. Require the use of technology for all audit and
administrative tasks10. Develop a succession plan so that audit software
does not become shelfware
7/12/2013
14
AHIA Improvement Needs Top 527
Continuous Audit
IT Audit Performance
Data Analytics
Enterprise Risk Management
Clinical Processes
Future Predictions
Standards will mandate use of technology tools for audit
New generation of auditors must have the KSA to utilize technology
If auditors and audit departments do not adapt to new technology they risk outsourcing
Social networking will evolve to professional networking
Tools will become more intuitive Knowledge hubs for audit tool, techniques and
resources will consolidate and merge
7/12/2013
15
Audit Programs in the Queue AuditNet®
Auditor’s Guide to Cloud Computing - Security Considerations.xls
Cloud Matrix_Benefits & Risks.xls AuditNet® Guide to Social Networking AuditNet® Guide to Wireless Security Business Continuity Planning – A Diagnostic Tool Forensic Document Examination Guidelines for Validation Testing Data Analytics Enabled Audit Programs for Key Business
Processes AuditNet® is working to provide tools and resources to
keep pace with new technology!
Conclusion
I hope that I have provided you with some useful information that will stimulate your thought processes!
Any questions?