The webinar took place on the 30th of January, from 13:00 to 14:00 (CET). if you could not attend, the replay is available below.
- Astrid Langeveld, Chief Audit Executive at Achmea, ECIIA Insurance Committee member (facilitator)
- Robert Zergenyi, Audit Head Group Technology and Operations/ Group Audit at Zurich Insurance
- Adel R., Chief Audit Executive at Descartes Underwriting
- Hussain Shehryar Humayun, Audit Director-Applications, Data and Applied Sciences at Lloyds Banking Group
RiF 2023 feedback
- Cybersecurity and data security remain the top of the risks list for the 2023 audit plan.
- Digitalization and disruption risk is expected to raise and remain on the 4th position in 2026.
- The current time spent by internal audit is insufficient, in relation to the risk importance.
- But, in 2026 it will become the second area of importance, in terms of time spent by internal
- auditors (after cybersecurity and data security).
A. What are the key areas where your organization introduced digitalization?
There are evolutions in the digitalization. The focus can be on the front end:
- the digitalization of the customer’s experience: the account opening, the loan, and the mortgages. It can be complemented by dedicated/personalized services for the clients: massive data are used with artificial intelligence, and machine learning.
The focus can be on the back end:
- the processes are digitalized to gain speed and efficiency: robotic processes, artificial intelligence modeling…
- creation of an ecosystem with automatic interaction with customers and market participants.
B. How can organizations enable a culture of digitalization, promote it and maintain it?
- There is no one size fits all solution, it depends on digitalization maturity of the company and
- the business
- More mature businesses must digitalize quickly to maintain their position in the market and
- maintain their market value.
- There are different approaches to go digital: digitalization laboratory, isolation of some parts of
- the business, merger, and acquisition (early innovation or more mature…),….
- Culture is key for innovation: organizations must not be afraid of failures, and they must learn fast.
- The tone at the top (digitalization in the organization values) is also crucial.
C. How to audit digitalization initiatives in the business? Such as artificial intelligence?
- Internal audit (IA) can start with the identification of new risks linked to digitalization and
quickly adapt the audit plan.
- IA must understand the controls/involvement/business model and governance on new
digitalization business/processes through the 3 lines: who does what?
- IA has a role in all the steps of the development of digitalization projects.
- Assurance can be given even in the start of the project: a quick report on the model design for
- IA must define the adequate type of product (flash reports, agile audit,…).
- It is difficult to onboard specific skills (tech profiles) in the IA department.
- IA must look in detail at the data used and audit the models used.
D. What is your experience using artificial intelligence in audit work?
- It is very useful for intangible data (around 80% of the data) such as for example customer communication, complains…. The programs create classification, and clustering there are extra areas to audit and the assurance scope is broader.
- Artificial intelligence can be used in the planning phase: models help to find patents, trends to further, investigate in terms of risks.
- The data can be analyzed before starting the audit to identify areas of concern.
- Artificial intelligence facilitates the root causes identification.
- Finally, the algorithms used by IA can be used by the business as well
- It is important to start with digitalization in the business but also in the IA functions: do not be afraid of failures and learn fast!
- It is an important topic for IA and they should spend more time on this risk.
- IA should be involved from the start of the project and in the whole value chain.
- IA must think about the right products to be agile and close to the digitalization topics.