Jamie Williams PwC, Systems & Process Assurance PwC
Agenda 1. Technology and PwC State of Internal Audit Survey 2. Technology/Data Analytics 3. Continuous Monitoring 4. Common Software 5. ACL Scripts 6. Resources 7. Q&A Slide 2
Introduction 8 Key Attributes of a High Performing Internal Audit Function Slide 3
Introduction 8 Key Attributes of a High Performing Internal Audit Function Source: PwC s 2010 State of the internal audit profession study Slide 4
Introduction Leverage Information Technology Effectively 1. Audit Management systems are used to improve audit effectiveness and efficiency 2. Specific steps are taken to capture and share knowledge through internal audit and the business 3. Governance, risk and compliance (GRC) tools are leveraged to ensure related activities are efficient and coordinated 4. Technology is utilized to improve audit process efficiency, through data retrieval and testing, data mining, and analytics. 5. Continuous audit techniques are leveraged to increase audit coverage and provide early warning of risk indicators. Source: PwC s 2010 State of the internal audit profession study Slide 5
Introduction Leverage Information Technology Effectively 1. Audit Management systems are used to improve audit effectiveness and efficiency 2. Specific steps are taken to capture and share knowledge through internal audit and the business 3. Governance, risk and compliance (GRC) tools are leveraged to ensure related activities are efficient and coordinated 4. Technology is utilized to improve audit process efficiency, through data retrieval and testing, data mining, and analytics. 5. Continuous audit techniques are leveraged to increase audit coverage and provide early warning of risk indicators. Source: PwC s 2010 State of the internal audit profession study Slide 6
Introduction Year-to-year efficiency priorities Increase use of technology Simplify reporting Identify audit process inefficiencies Utilize a more risk based approach Standardize audit procedures Reduce travel Reduce external training 14% 11% 46% 42% 34% 49% 29% 24% 23% 39% 31% 58% 69% 69% Plan to employ Have employed Source: PwC s 2010 State of the internal audit profession study Slide 7
Introduction Barriers to Effective Use of Technology Lack of skills and knowledge 55% 56% Lack of access 36% 43% Lack of methodology 40% 41% Other 45% 54% Data tools Organizational systems Source: PwC s 2010 State of the internal audit profession study Slide 8
Introduction What do you see as the primary benefit achieved from leveraging technology? A. Greater coverage B. Targeting testing C. Efficiency D. Continuous monitoring E. No measurable benefit F. Not applicable Source: PwC s 2010 State of the internal audit profession study Slide 9
Introduction Benefits of Leveraging Technology No measurable benefit 56% Greater coverage 38% Targeted testing 29% Efficiency 24% Continuous monitoring 22% Source: PwC s 2010 State of the internal audit profession study Slide 10
Technology/Data Analytics PwC
Technology/Data Analytics Technology-enabled audit strategy Slide 12
Technology/Data Analytics First, lets envision an end point Slide 13
Technology/Data Analytics Technology/Data Analytics as a tool for audit Slide 14
Technology/Data Analytics Technology/Data Analytics as a tool for audit Slide 15
Technology/Data Analytics Technology/Data Analytics Slide 16
Technology/Data Analytics Stage 1 Example: Procure to Pay Slide 17
Technology/Data Analytics Stage 1 How a business process is stored in an ERP Slide 18
Technology/Data Analytics Stage 1 How a business process is stored in an ERP (continued) Slide 19
Technology/Data Analytics Stage 1 Data Structure Slide 20
Technology/Data Analytics Stage 2 Technology/Data Analytics Slide 21
Technology/Data Analytics Stage 2 Uncovers Hidden Relationships Slide 22
Technology/Data Analytics Stage 2 Data Quality Challenges Slide 23
Technology/Data Analytics Stage 2 Data Quality Challenges Slide 24
Technology/Data Analytics Stage 3 Technology/Data Analytics Slide 25
Technology/Data Analytics Stage 3 Association of Certified Fraud Examiner - Potential Fraud List Slide 26
Technology/Data Analytics Stage 3 ACFE - Potential Fraud List (continued) Automated the Audit Slide 27
Technology/Data Analytics Stage 3 Payroll Automating he Audit Slide 28
Technology/Data Analytics Stage 3 Time and Expenses Slide 29
Technology/Data Analytics Stage 3 General Ledger Slide 30
Technology/Data Analytics Stage 3 General Ledger Slide 31
Technology/Data Analytics Stage 3 General Ledger Slide 32
Technology/Data Analytics Stage 3 Account Payable Slide 33
Technology/Data Analytics Stage 3 Fraud Identification - Benford s Analysis d p 1 30.1% 2 17.6% 3 12.5% 4 9.7% 5 7.9% 6 6.7% 7 5.8% 8 5.1% 9 4.6% Slide 34
Technology/Data Analytics Stage 4 Technology/Data Analytics Slide 35
Technology/Data Analytics Stage 4 Transaction Scoring Slide 36
Technology/Data Analytics Stage 4 Transaction Scoring Slide 37
Technology/Data Analytics Stage 4 High Risk Employee Slide 38
Technology/Data Analytics Stage 4 High Risk Dashboard Slide 39
Technology/Data Analytics Stage 5 Technology/Data Analytics Slide 40
Continuous Monitoring Continuous Monitoring Slide 41
Common Software Used PwC
Common Software Used Project Tools Slide 43
Common Software Used State of Internal Audit Profession Survey March 2010 Slide 44
Common Software Used Comparison of Excel, Access and ACL Slide 45
ACL Scripts- Examples PwC
Examples of ACL Scripts ACL Scripts Slide 47
Final Thoughts 2010. All rights reserved. "" refers to the East Caribbean firm of or, as the context requires, the global network or other member Firms of the network, each of which is a separate and independent legal entity. PwC
Q&A PwC
Contacts For more information contact: Jamie Williams Director 246 626 6812 Jamie.Williams@bb.pwc.com Jason Ramsay Manager 246 626 6849 Jason.Ramsay@bb.pwc.com Slide 50
Resources Resources Tools Linkage ACL www.acl.com PwC s State of the Internal Audit Profession 2010 http://cfodirect.pwc.com/cfodirect Web/Controller.jpf?ContentCode=M SRA-84HHVU&rss=true PwC s Maximizing Internal Audit A 10 step imperative for thriving in a challenging economy http://cfodirect.pwc.com/cfodirect Web/Controller.jpf?ContentCode=M SRA7ZWL7Z&ContentType=Content Texas ACL Group www.texasacl.com GTAG3: Continuous Auditing http://www.theiia.org/bookstore/down loads/freetomembers/1467355_1010.dl_gtag3.pdf Automated the Audit Slide 51
The information contained in this document is for general guidance on matters of interest only. The application and impact of laws can vary widely based on the specific facts involved. Given the changing nature of laws, rules and regulations, there may be omissions or inaccuracies in information contained in this document. This document is provided with the understanding that the authors and publishers are not herein engaged in rendering legal, accounting, tax, or other professional advice and services. It should not be used as a substitute for consultation with professional accounting, tax, legal or other competent advisers. Before making any decision or taking any action, you should consult a professional. While we have made every attempt to ensure that the information contained in this document has been obtained from reliable sources, is not responsible for any errors or omissions, or for the results obtained from the use of this information. All information in this document is provided "as is", with no guarantee of completeness, accuracy, timeliness or of the results obtained from the use of this information, and without warranty of any kind, express or implied, including, but not limited to warranties of performance, merchantability and fitness for a particular purpose. In no event will, its related partnerships or corporations, or the partners, principals, agents or employees thereof be liable to you or anyone else for any decision made or action taken in reliance on the information in this document or for any consequential, special or similar damages, even if advised of the possibility of such damages. 2010. All rights reserved. refers to LLP (US) or, as the context requires, the global network or other member firms of the network, each of which is a separate and independent legal entity. *connectedthinking is a trademark of LLP (US). PwC