Banking

Internal audit (IA) is more often than not viewed as a ‘check the box’ exercise on a compliance to-do list. While it’s true that banks do have to perform set IA tasks, limiting your work to what’s required not only could leave your institution vulnerable, it could diminish the value of an otherwise highly valuable effort.

“Business and government face significant challenges to keep pace with a dizzying array of rapidly emerging and evolving risks. The internal audit profession is in an ideal position to help them, but we must have the right talent at our disposal to provide that assistance.”

Banks are like many other organizations in that they are adept at producing data yet often fall short on interpreting and applying its value. But for banks in particular, analytics are incredibly important. The ability to read and interpret collected intelligence is critical to a sound internal audit (IA) function. 

The internal audit function can be a powerful resource for creating competitive advantages and driving growth. It’s relatively intuitive to consider how identifying efficiencies and mitigating risk can aid in the sustainability of an organization. A deeper look at the internal audit (IA) process reveals that it is also incredibly effective for nurturing a strong bank culture during an M&A transaction. 

Let’s begin today with a brief multiple choice quiz. Internal audit allows your financial institution to do which of the following:

1. Increase revenue production

2. Cut costs

3. Produce reliable numbers for informed decisions

4. Increase efficiencies

5. Reduce fraud risk

6. All of the above 

Internal audit is an objective source of confidence for stakeholders, and proof that your bank is compliant and prepared for the future. Typically, an internal auditor will focus on things like reputation, growth, and corporate governance by keeping sight of controls and management, risk, and operations. The most valuable and effective internal auditors, however, go beyond those functions. They help the bank to stay aware of business trends and remain anticipatory so you are equipped and prepared for upcoming challenges, risks, and opportunities.