Internal Audit- data analytics as enabler for supporting the realization of business objectives


Objective

Internal Audit is looking for ways to increase added value in realizing business objectives and support performance improvements initiatives proactively.

Both 'risk and control evaluation' as well as data analytics are competencies required to realize this objective. These competencies have to be aligned to perform any activity effectively. Data analytics could be used to establish process improvement within and beyond Internal Audit (e.g. contribute value to planning).

In realizing the objectives, Internal Audit:

  • performs controls testing and risk assessment on a frequent basis (near real-time) and in an automated manner
  • identifies risk areas before they have an impact on the business and is perceived as proactive in identifying risks and improvement opportunities
  • transfers knowledge to business to achieve overall optimization

Case study credit invoices

  1. Business Objective: Sales invoices should be paid within 30 days after issuance. Delay in cash collection has a negative impact on cash flow position

  2. Risk description: Cancelation of sales invoices and issuance of new invoices leads to the situation that the business objective is not realized
  3. Measure: Using data analytics, the date of the original invoice is compared with the cash receipt date of the newly issued invoice. The magnitude of late cash receipt and the number of days exceeding the payment terms are determined
  4. Root cause: The root cause of the incorrect issued invoices was improper use of the system caused by insufficient knowledge of the employees
  5. Remediation: Process owners followed a training and the ERP system was modified to better support the invoicing process
  6. Delegation: Internal Audit documented the solution and provided the queries and analysis performed to business management. Going forward, business management uses the queries to periodically assess the realization of the business objective

Our approach

  • Select a business process as pilot together with Internal Audit and the business
  • Understand the strategic objectives of this process
  • Define the risk areas
  • Define the indicators that link to these risks (data-driven)
  • Define data needed to build data analytics solution
  • Build and implement the solution to measure the indicators
  • Measure efficiency and effectiveness improvements of Internal Audit
  • Share results with the business
  • Support business to incorporate the solution as their own monitoring tool


In every stage of the project KEY Group will challenge you using best practices to ensure a sound decision making process.

For questions please contact us.


Our flyers


Take aways 

  • Set up a project charter that will take effect preferable during feasibility but ultimately during design
  • Write a business case and problem statement
  • Define scope of the project
  • Define objectives and goals of the project
  • Involve stakeholders and define priorities
  • Set measurable milestones
  • Ensure that the right sponsors provide buy-in.
  • Identify (project) risks and how to manage them
  • Jointly validate and refine the project plan and develop a roadmap to success
  • Hold regular meeting to track progress of the various work streams

We combine technical knowledge with industry understanding and knowhow of technologically advanced tools and methodologies available in the market or developed by ourselves.

  • Focus on business processes that could be improved
  • Perform As-Is assessment
  • Anticipate future changes
  • Define scope and actions for short, mid and long term
  • Write business case for change
  • Realize sponsorship for implementation

 

Technology-related risk: understand and address the potential harms and benefits of (new) technology.

Privacy is high on the priority list of organizations nowadays, not only because of the more stringent laws and regulations, but also because of the significant impact financially and on a company’s reputation in the market and competitive position especially if complying with regulations is a competitive advantage.

We understand the language of the business as well as IT.