Internal Audit Strategy: Focus area four – data analytics

27 May 2022

Data analytics in audit – area four

We’ve been spreading awareness for Internal Audit Awareness Month through introducing the details of our Internal Audit Strategy (2021-24).

So far we’ve looked over:

Focus area four of our three-year strategy

Having a data-enabled internal audit service is more important than ever. Data underpins our clients’ processes, operations and decision making.

Advances in technology have made it possible for audit teams to conduct data analytics more efficiently. Tools allow us to provide real or near-time assurance over and above that provided by traditional techniques.

The Public Sector Internal Audit Standards (PSIAS) say:

In exercising due professional care internal auditors must consider the use of technology-based audit and other data analysis techniques.

We can provide a greater breadth and depth of assurances through effective use of data analytics and whole population testing.

What is a ‘data-enabled’ audit service?

When we refer to a ‘data-enabled’ service we mean harnessing the power of data to provide genuine insight.

This means taking all possible opportunities to use data analytics in individual engagements (throughout the audit lifecycle) more strategically.

We want to employ regular, frequent and systematic data analytics as widely as possible while freeing up capacity for shorter, more bespoke reviews.

Our IDEA group

Veritau has been using the specialist data analytics software IDEA for a number of years. IDEA allows a trained user to analyse large and complex sets of data.

Our IDEA group are experts in the software. We use it in a variety of ways, including to:

Management lead for data analytics

Audit Manager Ed Martin is delivering on this area of the strategy, as he oversees our data analytics function:

Data analytics in audit: image of Ed Martin with quote: 'Many organisations hold increasingly large volumes of data and good use of that data underpins operations, processes and decision making. Data analytics gives us insights that traditional auditing methods might miss. What’s more, it can enable us to provide quicker and more responsive assurance. Combined with our auditors’ skills, experience and judgement we can provide valuable advice to our clients to help improve their operations.'

Action plan for developing data analytics in audit

As with the other four focus areas of our strategy, we’ve included an action plan to help us achieve our goals. This includes:

  • Increasing membership of our IDEA group
  • Creating a searchable library of all successful IDEA audit tests
  • Using data analytics in key financial systems audits
  • Identify areas with potential for continuous auditing
  • Participate and contribute to data analytics networks
Applying data analytics to wider assurance

Covid grants fraud: data analytics case study

Read our case study on using data analytics to find fraud and error in Covid grants system.

File type: pdf

File size: 1MB

Download this file
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Recap the overview of our strategy, or look in more detail at focus areas one, two and three.