Over the last few years, technological developments have begun to accelerate if compared to previous decades, and their impact on the distant future may be far greater than currently expected. We have begun to see unmanned vehicles based on artificial intelligence, aircraft vehicles, high-speed trains, 3D printing and self-operated factories without human intervention, as they wholly rely on robot. These developments, if continued in this form and developed further in the future, will result in a large decline in labor force and a decline in the proportion of jobs in general and these developments may lead to a decrease in accident and mortality rates which will be reflected directly on the demand for other sectors such as insurance and health sectors, which means fewer workforce in these sectors. Non-traditional laws, policies and procedures may also be introduced that may limit the demand for the future internal audit profession. In this article, let us anticipate events and take a look at the challenges that may face the internal audit profession in the future.
The technological developments have been adopted and welcomed by companies, institutions and operators in various pivotal sectors that have a fundamental impact on all aspects and patterns of life such as aviation, transportation, energy and industry. It is worth noting that the resistance to forms of change has fallen to low levels, and same has changed many concepts and methods of corporate management in line with the aspirations of the future. In this regard, the internal audit should play a role that meets the expectations and is in line with the rapid developments. However, there are many challenges that the internal audit has to understand and set development plans to confront them from this moment until the internal audit plays a positive role and until the profession progresses in line with the expected developments. These challenges are:
Due to the differences in business environments and more reliance on artificial intelligence and speed of decision-making, the independence of internal auditing may be one of the obstacles that keep internal audit away from the decision-making process. Advising senior management may be the biggest role in the future that relies on speed of decision-making, analysis of major data, and self-decision making by technical systems, and there may be significant development in networking between companies, banks and different governments and competition may depend on who has more information, all this requires the internal audit to think differently outside the traditional box and think in a way that will sustain business.
Change of Business Models
Perhaps the biggest challenge for internal audit is to change corporate business models. In the future, we may see automated systems that have the ability to make decisions that affect the business model adopted by the company, and we are likely to see a different risk management culture than what is commonly adopted, and the culture of acceptance of risk may become more common than the current in the light of intense competition and an environment of rapid decision-making. This challenge requires internal audit to keep abreast of developments and develop the profession in line with advanced business models.
Availability of Competencies and Skills
A technology-based future requires skills that depend on technology and professionalism. Engineers and programmers may be the majority of internal auditors. Data analysis skills and industrial behavior analysis skills are a prerequisite for future auditors. These changes may make the selection of internal auditors a challenge for internal audit departments that wish to employ qualified auditors.
Building an Internal Audit Plan
Building an internal audit plan is a key challenge in the future. The complexity of the technology-based business environment makes it difficult to define the universe and the scope of audit, and the current risk assessment method may need to be developed, as the accelerated developments of the future business environment may render the emerging and strategic risks on which the process of building the internal audit plan relies.
Reliance on Automated Systems
The lack of intervention by the human factor in the event that technology controls the business of companies in the future may make the factor of judgment and diligence of the internal auditors more difficult. Will we see a robot internal auditor in the future? This may be a challenge in itself.
Communicate Audit Results
One of the challenges that internal audit may face is the change of traditional communication methods from what is currently known, most of which rely only on reporting. This challenge requires auditors to have sophisticated communication skills and methods based on fast access to results and rapid reporting.
In the end, the Institute of Internal Auditors must take such challenges into account to develop the internal audit profession so as to ensure the sustainability of the profession and to reserve a suitable place in the future, especially that there are many professions and jobs will disappear or change significantly in the future and I think the internal audit profession will be one of these professions that will change and take a new shape that may be quite different from the current one.