Artificial intelligence. The phrase has gotten a bad rap over the years. It conjures up images of uncertainty and discomfort for readers, encouraging them to ask the question, “What does artificial intelligence mean for me?”, “Am I going to lose my job?” Let us delve a bit deeper into the phrase.
Something that is artificial is man-made and intelligence refers to intellectual capacity. It is essentially a tool that can be used by humans to streamline processes and assist in decision making. We have all heard about the wonders of AI chatbots and their many abilities. There are a multitude of different kinds of artificial intelligence, but this article focuses on how AI impacts the Internal Audit process in organisations.
Just how does AI impact Internal Auditing in organisations, you may be asking yourself? Well, in some cases, Internal Audit tends to be quite a manual process. When testing controls, the internal auditor must break down systems and processes into singular controls to evaluate their adequacy and effectiveness.
This is achieved through performing a walk through with the client and obtaining a first-hand account of how the system functions. Samples are then selected and tested by the auditors, and findings are drafted depending on the results obtained during testing. The internal auditor will then present their findings to management and obtain management’s comments. Depending on the scope of the system, it can be a time-consuming process.
This is where artificial intelligence and process automation come in. Internal auditors can find ways to automate aspects of their audit process, and this can go a long way in reducing the audit timeline. There are many different AI tools available nowadays that can assist with writing, productivity, and research, among other things. If you can think it, there is probably an AI tool for it.
Additionally, internal auditors can automate the aspects of their engagements that are standard from one engagement to another, as no engagement is the same, but there are always common elements. This can free up valuable time that can be used for aspects that require a more human approach. We do not want an overload of AI in our interactions, as they will lose their spontaneity. As in all things, balance is key.
As the saying goes, one must be cognisant of “too much of a good thing.” Artificial intelligence cannot simulate the reasoning ability of an experienced auditor. In other words, AI cannot think for you, that is up to you. Internal Auditors also require the people skills needed to interact with clients and present findings to them. These are skills that are only acquired through experience and are not something that can be effectively performed by AI.
In other words, artificial intelligence is not a one size fits all approach. Each client and engagement is different, and Internal Audit should aim to tailor the engagement approach so that the objectives of the engagement are met. Let us use AI where we can, but not lose sight of what makes us human.