Last year in this very same article, I wrote about what I called, “a palpable concern for the future among internal auditors.” As 2023 was ending and 2024 was beginning, uncertainty and angst ruled the day. We were still shaking off the lasting effects of the COVID-19 pandemic, conflicts in the Middle East and Ukraine were either new or escalating, artificial intelligence was fairly fresh on the scene and fraught with both promise and peril, and the U.S. economy was teetering on the verge of recession.
Fast forward a year, and its safe to say that the business world as a whole and internal auditing in particular appear to be standing on firmer ground. The Pandemic looks to be well in the rear-view mirror, tensions have eased slightly on the geopolitical front, AI seems a little less scary, and the economy appears to be going in the right direction. Studies have found that a focus on identifying and managing risk and control, has put internal audit in a slightly more prominent position at many organization with better funding and a clearer mandate.
That’s not to say that internal auditors feel like they are completely in the clear and ready to chug forward at full steam. They realize that technology is still evolving the internal audit profession at a rapid pace and that digitization hasn’t run its course in recasting just about every aspect of corporate and organizational dynamics.
Big questions linger on several fronts: What will the new presidential administration mean for regulation, inflation, and economic progress? What emerging technologies will prove impactful in how internal audit conducts its work and which ones will prove more fizzle than spark? Will diplomacy and calmer heads cool climbing geopolitical temperatures, or will tensions only escalate? Amid this uncertainly, there is one thing we can all be sure of. The pace of change is unlikely to slow anytime soon.
Yet it’s when things are moving fastest and changing the most rapidly that risks arise, strong control and structure is required, and solid assurance is most needed over what is happening inside and around our businesses and organizations. Sounds like a job for internal audit. And smart internal auditors sense more of an opportunity than a threat and they are positioning themselves and their departments to thrive amidst the chaos.
As we look back on the top internal audit articles of 2024, we see many of these themes emerging in the articles that ranked the highest among you, our readers. In the article, “Eight Uncomfortable Truths About Internal Audit in 2024,” we look at some of the progress the internal audit profession has made, as well as the challenges internal auditors still face.
While considering the future, its also clear that internal auditors want to maximize their value in the organization right now. Another high-ranking article, “It’s Time to Ditch the Annual Audit Plan,” looks at the internal audit planning progress and how internal audit can better react to emerging risks in real time. Another indication that maximizing value is on internal auditors’ minds shows with the popularity of the article, Internal Audit’s Increasing Role in Hunting for Fraud. These are indications that internal audit leaders realize that to take on the challenges of an uncertain future, they must have their audit houses in order.
Looking Forward to 2025
As we look forward into 2025, these underlying trends will continue to challenge and shape internal audit in the coming year. Let’s hope that a resilient economy and low unemployment will continue. Let’s hope our leaders, both nationally and globally, can learn to find common ground and focus on solving our collective challenges, rather than choosing only to battle each other.
Like the last few years, many of us may be happy to turn the page on this turbulent year, with hopes that 2025 will bring better tidings. We at Internal Audit 360° look forward to covering these critical issues and continuing the discussion on how internal audit can excel and make great contributions to the overall success of the organization.
We’d also like to take this opportunity, from our families to yours, to wish you a joyous holiday season, a Merry Christmas to those who celebrate it, and a happy and safe New Year!
Top Internal Audit Articles of 2023:
1 Eight Uncomfortable Truths About Internal Audit in 2024
Internal audit has gone digital, branched out into every facet of the organization, leveraged data analytics, and has made several advancements in quality and efficiency. Yet, as far as internal audit has come, one thing hasn’t changed that much: we often don’t feel like we get our full measure of respect and stature. As we reflect on where internal audit is as a profession and consider what internal audit still needs to accomplish, eight uncomfortable truths come to mind. Now, not all internal audit functions suffer from all of these challenges. But my strong suspicion is that many of you will recognize some of these issues that still vex the internal audit profession after more than 80 years since the Institute of Internal Auditors was first founded.
2 It’s Time to Ditch the Annual Audit Plan
Still locking into an annual audit plan? Stop. Risks move too quick to be addressing last year’s concerns as many as six, ten, or more months after the fact. Would you plan your whole week’s wardrobe based on the weather report at the start of the week and not waiver from it? Probably not. The same can be said about audit planning. The risk landscape is constantly changing, so audit plans need to change along with them. It’s time to get away from conducting a once-a-year risk assessment and turning that into an all-important, unchanging annual internal audit plan.
3Internal Audit’s Increasing Role in Hunting for Fraud
How can internal auditors look for fraud and assess fraud risks while remaining trusted advisors to their audit clients and management? The question is gaining renewed attention, in part because both the new Global Internal Audit Standards from the Institute of Internal Auditors (IIA) and the proposed standards from the International Auditing and Assurance Standards Board (IAASB) include a greater emphasis for auditors on fraud risk. While balancing these two objectives isn’t always easy, it is possible. Critical steps include transparency, training, and alignment with the organization’s priorities.
4A Guide to Crafting Compelling Internal Audit Reports
Internal audit reports play a crucial role in ensuring organizational governance and driving improvement. However, crafting reports that are clear, concise, and impactful can be a challenging task. This guide equips you with the knowledge and tools necessary to transform your internal audit reports from mere documentation to powerful catalysts for positive change.
The Institute of Internal Auditors (IIA) recommends adhering to the Five Cs: Criteria, Conditions, Cause, Consequence, and Corrective Action. Employing this framework ensures your observations are well-founded, defensible, and drive meaningful action.
5What to Look for During an Internal Audit of the Procurement Process
As we saw during the supply-chain disruptions that occurred during and directly following the COVID-19 pandemic, procurement is a critical and fundamental component for just about any organization. A well-managed procurement function can move an organization toward success, while a mismanaged one has the potential to cause its downfall.
Because of these recent difficulties in the procurement process and the vital importance it holds, many internal audit teams have put an audit of procurement high up on the audit plan.
Achieving Success in 2025
We at Internal Audit 360° will have much more to say on these issues and many other internal audit topics in 2025, and we look forward to bringing you more articles, more internal audit news, and more coverage of the internal audit profession in the coming year. Have a wonderful year ahead, and we wish you much success in your internal audit pursuits.
One final word: We hope we can count on your support in the coming year. Please help by telling your friends and colleagues about us, like and share our links when you see them on social media, click on the ads on our site, and by doing these small things that are critical to our success:
- Sign up for our E-mail Newsletter: Subscribe!
- Join our LinkedIn Group: Join!
- And, follow us on Twitter: Follow!
Thank You! Here’s to a happy, healthy, and successful 2025!
Joseph McCafferty is Editor & Publisher of Internal Audit 360°