4 strategies for internal auditors to prepare for emerging risks

Every year, technology and other advancements make life easier in many ways, but also come with a downside consisting of new risks and threats your company may not be prepared to face.

 Compliance specialists from Workiva published their predictions for 2024 to help finance, ESG, legal, audit, and risk teams prepare for what’s next. These predictions are based on discussions held by more than 8,000 professionals at their 2023 Amplify conference. 

In this report, you’ll find some gems and valuable insight that come directly from industry insiders, including how automation will be essential to embrace in 2024.

 If you’re an internal auditor, consider implementing the following strategies to mitigate emerging risks in 2024 and beyond.

 1 Perform more frequent risk assessments

 Since threats are always changing and new threats emerge quickly, it’s crucial to perform frequent risk assessments to encompass current concerns. If anything new pops up, it might be worth performing a risk assessment on that particular item.

 The more often you perform risk assessments, the more likely you are to catch problems and stay ahead of risks within your control.

 2 Audit based on specific risks

 The most effective risk assessments will be those performed to address specific risks rather than filling out an arbitrary time frame. For example, some companies decide to embark on a 6-week audit, which encourages people to fill in their time with minutia and things that don’t really matter. The actual audit may have been done by week 4, but since it’s a 6-week audit, the team will keep going until the end.

 Instead of doing it this way, try scheduling risk assessments based on the specific risks you want to address. For instance, run a cybersecurity risk assessment with clearly defined goals and allow meeting those goals to determine when it’s complete. You can still create an ideal time frame but don’t make the time frame the goal to achieve.

3 Break down silos

 Continually breaking down silos will help you improve collaboration between auditors, risk, and compliance. This is crucial for staying on top of emerging compliance risks. Everyone involved should be able to look at the same data before making any decisions.

 When it comes to businesses governed by regulatory bodies, new regulations can create a flood of new risks. For instance, each time a new regulation becomes law, businesses are given only a short period of time to comply. Even when you get several months to a year, the length of time is deceptive because it can take that long (or longer) to reorganize your company’s internal workings. However, having clear insight into your organization helps. You can accomplish this by constantly striving to break down silos and unify data.

 When your silos dissolve, it opens up the possibility for better collaboration, including continuous communication and systematic processes for gathering and documenting insights. The best strategy in the world will always fall short when there are silos preventing it from working properly.

4 Hire cybersecurity specialists

 Cybersecurity threats are always a top priority, and truthfully, they can be so advanced it’s hard to stop them without an expert. If you don’t already have a professional cybersecurity expert on your team, consider hiring one as soon as possible. Managing risks related to cybercrime is no longer optional if you want to stay in business.

 One cybersecurity incident, like a data breach or ransomware attack, has the power to put you out of business, either from lost time or lawsuits and regulatory fines.

 The biggest threat in this arena is AI, and it’s because generative AI programs can provide information and ideas to cyber criminals to make their goals easier. Most generative AI systems are programmed to block prompts with malicious intent, but not all. If someone can create the right prompt, they can get insights into how to better engineer phishing schemes and more.

 Consult with a professional risk assessment team

 Staying on top of emerging threats is a must. If you’re confused or don’t know where to start, hire a professional risk assessment company to audit your current system and suggest changes. They can even revamp your whole process if needed. This is the fastest way to ensure you are not only compliant with existing regulations, but set up to successfully mitigate emerging threats now and in the future.

 

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