The field of internal audit is evolving rapidly, driven by emerging risks, heightened expectations from stakeholders, and advancements in technology. As we move into 2025, internal auditors face both challenges and opportunities to enhance their strategic value within organizations. This article explores key trends shaping internal audit and how technology can support audit teams in navigating these changes effectively.
Trend 1: Strategic Alignment in Internal Audit
With the recent updates to global internal audit standards, there is an increased emphasis on aligning internal audit functions with organizational strategy. Chief Audit Executives (CAEs) are now expected to develop comprehensive strategies for internal audit operations, resource allocation, technology adoption, and leveraging external assurance efforts.
This shift underscores the growing expectation for internal auditors to serve as strategic advisors rather than just compliance enforcers. However, achieving this alignment presents challenges, including balancing new strategic responsibilities with existing workloads and overcoming the perception that internal audit functions are purely operational.
Key Example: Consider an organization that implemented entity-risk-based audit planning. By associating specific risks with different business units, the internal audit team was able to prioritize audits based on the highest risk areas, thereby providing more strategic insights to the board and senior management.
Technology’s Role: Advanced audit management systems offer entity-risk-based planning tools that help auditors identify and assess the most critical risks. Additionally, self-assessment tools facilitate ongoing evaluations of internal audit conformance with new standards, enabling continuous improvement and strategic transformation.
Trend 2: Expanding Skill Sets Amid Emerging Risks
The rapidly changing risk landscape—including cybersecurity threats, data privacy concerns, AI adoption, and sustainability issues—necessitates that internal audit teams continuously enhance their skill sets. Many audit functions report gaps in critical areas due to resource constraints and talent shortages.
To address this, CAEs are exploring innovative strategies such as co-sourcing with external experts, partnering with other risk and compliance functions, and leveraging technology to enhance capabilities and efficiency.
Key Example: A global enterprise facing complex cybersecurity risks introduced a skills tracking system within its internal audit team. This tool helped the organization identify existing skill gaps, plan targeted training programs, and make informed decisions about hiring and resource allocation.
Technology’s Role: Modern audit platforms provide capabilities for tracking staff qualifications, planning resources based on availability, and fostering collaboration through control owner self-assessments. These tools enable audit teams to manage workloads efficiently while ensuring that they possess the necessary expertise to address emerging risks.
Trend 3: Increasing Risk Assurance with Limited Resources
As organizations face an expanding array of risks, internal audit functions are expected to provide more comprehensive risk assurance. However, many audit teams continue to operate with constrained budgets and headcounts, making it essential to find ways to enhance efficiency and impact.
Key Example: An internal audit team streamlined its processes by integrating audit analytics and automation tools. This approach not only reduced manual workloads but also enabled more thorough testing and faster decision-making, ultimately delivering greater assurance to stakeholders.
Technology’s Role: Audit analytics tools facilitate efficient data analysis, automated testing, and seamless integration with enterprise systems. AI-driven features such as automated issue documentation and interactive workpaper management further enhance productivity, allowing audit teams to focus on high-value activities.
Preparing for the Future
The internal audit profession is at a pivotal moment, with new standards, emerging risks, and technological advancements reshaping its role. By embracing these trends and leveraging innovative technologies, internal audit teams can enhance their strategic impact, improve efficiency, and provide valuable insights that drive organizational success.
As internal auditors prepare for 2025 and beyond, the ability to adapt and innovate will be critical. By focusing on strategic alignment, skill development, and resource optimization, internal audit functions can transform challenges into opportunities and play a vital role in navigating the complexities of the modern business environment.
