Internal audit is a profession that struggles against the stereotypes of our past. When we explore our current processes and methodologies, one area that needs attention is executing the audit plan. If our focus is setting a plan in motion and tracking to completion each year, then we are not able to react to changes in our organizations. Financial services organizations face additional challenges in trying to balance emerging risks with the requirements of the regulatory authorities. By embracing the concept of agile auditing, we will be able to adjust more quickly and act as a more relevant partner to our organizations. Learning Objectives • Understand the concept of agile auditing • Identify areas for applying agile techniques • Discuss a strategy for successfully implementing agile audit

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Agile Auditing
Rethinking the Audit Plan for
Financial Services Organizations
Steven Zapolski MAcc, CIA
Senior Market Development Consultant
About Jim Kaplan, CIA, CFE
 President and Founder of AuditNet®,
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Windows devices)
 Auditor, Web Site Guru,
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Recipient
 Local Government Auditor’s Lifetime
Award
 Author of “The Auditor’s Guide to
Internet Resources” 2nd Edition
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Overview
Internal audit is a profession that struggles against the stereotypes of our
past. When we explore our current processes and methodologies, one area
that needs attention is executing the audit plan. If our focus is setting a plan
in motion and tracking to completion each year, then we are not able to react
to changes in our organizations. Financial services organizations face
additional challenges in trying to balance emerging risks with the
requirements of the regulatory authorities. By embracing the concept of agile
auditing, we will be able to adjust more quickly and act as a more relevant
partner to our organizations.
Agile Auditing
Learning Objectives
Understand the concept of agile auditing
Identify areas for applying agile techniques
Discuss a strategy for successfully implementing agile audit
Learn how TeamMate supports agile auditing
Agile Auditing
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POLLING QUESTION 1
Understanding the Concept
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Process Review
Pick
applications
to review
Submit list
for approval
Review
application
every third
year
Cut scope
due to
timing
Report
results
Annual risk
assessment
Develop 1-
3 year audit
plan
Present for
approval
Cut scope
due to
timing
Report
results
Agile Auditing
Application Audit Audit Planning
Understanding Agile Processes
 Originated from a software
development technique
 Alternative to traditional
project management
 Agile approaches help teams
respond to unpredictability
Agile Auditing
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Audit Planning
Our audit planning process is antiquated
and is in desperate need of updating
 Audit planning should be nimble
 We should tackle emerging risk areas
 Audit departments should add value!
Agile Auditing
POLLING QUESTION 2
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Audit Planning
 57% conduct an annual audit plan
with some periodic updates
 40% are updating their audit
plans either monthly or as audit
work is completed
 28% anticipate moving to a rolling
audit plan over the next two years
 5% are already conducting totally
rolling audits
Agile Auditing
Applying Agile Techniques
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Agile Audit Process Diagram
Risk
Assessment
Plan
Development
Plan
Execution
Reporting
Agile Auditing
Audit
Planning
Audit
Execution
Review
Reporting
Milestone
Planning
Milestone
Execution
Milestone
Review
Milestone
Reporting
Quarterly QuarterlyQuarterlyQuarterly
Defining an Agile Audit Planning Process
 Opt for a shorter plan, no more
than the next quarter
 Quarterly plan should go through
testing, review, and presentation
within the allotted time
 By the quarter end, start planning
the next quarter, considering the
outcome of prior testing and
emerging risks
Assessment
• Perform risk assessment
PlanPlan
Development
• Develop the risk based plan
• Communicate the plan to the audit committee
Execution
• Execute the audit plan
Reporting
• Report results
Agile Auditing
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Defining an Agile Audit Execution Process
 Overall audit process is the same
 Fieldwork is segmented into
smaller milestones
 Fieldwork milestones contain:
 Milestone planning
 Milestone execution
 Milestone review
 Milestone reporting
Planning
• Overall audit planning
Fieldwork
• Milestone planning, execution,
review and reporting
Review
• Overall quality review
Reporting
• Overall audit reporting
Agile Auditing
Successful Implementation of Agile Audit
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Applying Agile Techniques
 More frequent risk assessment
 Shorter audit plan
 Structure fieldwork into shorter activities
 Audit results feed back into the next quarterly assessment
 Audit software provides real time review and automated reporting
Audit Software
 Software should support continuous risk assessment with shorter audit
plan periods
 Score risk in the assessment to build plan (can be quarterly or real time)
 Risks carry to the audit and updated scores feed back into the assessment in
real time
 Software should include real time test review
 Software should provide historical insights, like showing past audit issues
in the risk assessment
 Reporting should be automated or produced quickly for frequent
management updates
Agile Auditing
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POLLING QUESTION 3
Traits of Successful Agile Departments
 Maintain an Internal Audit Strategic Plan
 Clearly link risk to business objectives
 Assess risk more frequently
 Leverage consistent risk terms and definitions as other risk functions
 Meet regularly with other risk and compliance functions
 Promote unified messaging, understanding of risk drivers
 Leverage industry and professional thought leadership sources
 Perform formal skills assessments with a longer-term view of needs and
actionable development plans
 Define and track learning roadmaps and continuing education requirements
Agile Auditing
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Practical Application
More frequent risk assessment
 Create audit from the assessment and include the risks from the
assessment
 The risks are now in the audit and can be modified wih results flowing back
to the assessment
Agile Auditing
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Shorter audit plan
 Create quarterly audit plans
 Set Capacity Planning to a
quarterly frequency
 Only build out one quarter at a
time, or build out the next quarter
as a tentative plan
Agile Auditing
Structure fieldwork into shorter activities
 Break fieldwork into smaller sections to allow for more frequent review
Agile Auditing
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Audit results feed back to the next assessment
 Roll quarterly assessments forward
and include Scores in the settings
 Updated scores and Historical
Insights feed back into your
assessment
Agile Auditing
Real time review and automated reporting
 Don’t wait until the end of the audit to start reviewing
 Set your dashboard and notifications to alert you when individual tests are
ready for review
 Reports can be configured to pull specific data and to automatically run
Agile Auditing
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POLLING QUESTION 4
Agile Auditing
Rethinking the Audit Plan for
Financial Services Organizations
Steven Zapolski Macc, CIA
Senior Market Development Consultant
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