2023 Internal Audit Hot Topic and Focus Areas.

We have searched across the web; through each of the Big 4’s websites, through the IIA, and across thought leadership sites to find out what they all consider to be the top risk / focus areas for Internal Audit going into 2023.

Each year, these risk in focus / hot topics reports can prove to be an invaluable resource for many audit functions and show many upcoming or potential risks which Chief Audit Executives (CAE’s) and Audit Committees should be considering. You can see what the 2022 hot topics were by reading this blog post, or you can read the 2021 blog post. If you’re really keen, you can go all the way back to the 2020 hot topics by reading this blog post.

In this post, we will show you what the IIA, PwC, Deloitte, Protiviti and Gartner all consider to be the main focus areas for 2023.

Here we go.

Institute of Internal Auditors

The Institute of Internal Auditors released their Risk in Focus 2023 report back in September this year. You can read our review of the report here. Following a survey amongst a number of Heads of Audit, the report identifies the following top 15 categories which are on people’s minds going into 2023:

• Mergers and acquisitions
• Health, safety and security
• Communications, reputation and stakeholder relationships
• Fraud, bribery and the criminal exploitation of disruption
• Organisational culture
• Organisational governance and corporate reporting
• Financial, liquidity and insolvency risks
• Supply chain, outsourcing and ‘nth’ party risk
• Business continuity, crisis management and disasters response
• Climate change and environmental sustainability
• Digital disruption, new technology and AI
• Changes in laws and regulations
• Macroeconomic and geopolitical uncertainty
• Human capital, diversity and talent management
• Cybersecurity and data security

You can view the full Risk in Focus 2023 report here.

Deloitte

Deloitte has set out a list of planning priorities for Financial Services Internal Audit for 2023. Their website includes an interactive diagram which highlights both risk areas, but also improvement or focus areas specific to the internal audit team. The diagram is also a neat tool which could be presented to your audit committee and show which topics you have already covered (or plan to cover) through your audit work.

Deloitte has identified the following hot topics Internal Audit in Financial Services:

• Regulatory
• Financial Crime and Sanctions
• Fraud Risk Management Framework
• Cryptocurrency / Digital Assets
• Payments Sector Regulatory Developments
• MIFID II – Transaction Reporting
• UK Solvency II Reforms
• Artificial Intelligence – Control Frameworks
• Operational Resilience
• Financial and Credit
• Pensions Dashboard
• The Pensions Regulator’s Single Code of Practice
• Regulatory Reporting
• ICARA Implementation
• IFRS 17
• ESG Risk Assessment and Disclosures
• UK Corporate Code Reform
• Governance, Risk Management and Culture
• Risk Culture
• Diversity and Inclusion
• Risk Management Effectiveness & Maturity
• Investment Governance
• Third Party Risk Management
• Remuneration Risk and Reward
• Conduct
• Improving the Appointed Representatives Regime
• Consumer Duty
• Consumer Affordability – Cost-of-Living Crisis Impact
• Technology and Digital
• Digital Transformation and Change
• Cloud Hosted Technology Environments
• Cyber Security Incident Response
• Internal Audit Innovation
• Internal Audit Analytics and Automation Factor
• Aligned Assurance
• Re-setting IA’s Purpose – IA 4.0
  

You can view the full Deloitte 2023 Internal Audit suggested areas of focus for 2023.

Alternatively, you can view the 2023 Hot Topics for IT Internal Audit report here which provides a great overview of focus areas for the year, as per the diagram below.

PWC

PwC have compiled their 2023 Financial Services Horizons Scanning for Assurance Functions report which lists various hot spots for considerations. The report goes into detail on the specific focus area for each individual hot spot. 

Hot spots identified for 2023 include:

• Customer outcomes
• Operational resilience
• Cyber
• Critical third party service providers
• Digital assets
• Auditing crypto assets

You can read the full 2023 Financial Services Horizon Scanning for Assurance Functions report here, and download specific financial services sector reports for more detail. 

Protiviti

Protiviti have pulled together a range of risks for consideration as part of their Executive Perspectives on Top Risks report.

The eight hot topics identified by Protiviti include:

• Succession challenges, including attracting and retaining talent
• Economic conditions
• Increased labor costs and impact on profitability targets
• Resistance to change
• Supply chain uncertainty
• Work environment and culture
• Adoption of digital technologies
• Risk management culture
• Workforce demands and hybrid working
• Business resilience and crisis management

You can read the full Executive Perspectives on Top Risks report here.

Gartner

Gartner’s Hot Spot summary includes the following:

• Cyber threats
• IT Governance
• Data Governance
• Third Party Risk Management
• Organisational Resilience
• Environmental, Social and Governance (ESG)
• Supply Chain
• Macroeconomic Volatility
• Workforce Management
• Cost Pressures
• Culture
• Climate Degradation

Specific details for each of the above topics are included in their report. 

You can view the full Gartner 2023 Audit Plan Hot Spots Report here. Please note, you do need to register to view this report. 

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