Driving the digital age - deloitte.com
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About Deloie This publicaon contains general informaon only and Deloie is not, by means of this publicaon, rendering accounng, business, financial, investment, legal, tax, or other professional advice or services. This publicaon is not a substute for such professional advice or services, nor should it be used as a basis for any decision or acon that may affect your business. Before making any decision or taking any acon that may affect your business, you should consult a qualified professional advisor. Deloie shall not be responsible for any loss sustained by any person who relies on this publicaon. As used in this document, “Deloie” means Deloie & Touche LLP, a subsidiary of Deloie LLP. Please see www.deloie.com/us/about for a detailed descripon of our legal structure. Certain services may not be available to aest clients under the rules and regulaons of public accounng. Copyright © 2021 Deloie Development LLC. All rights reserved 0% 10% 20% 30% 40% 50% 60% 20% 11% 18% With only 11% of respondents formally addressing ethics and bias concerns, a large opportunity exists to capture the benefits of trustworthy AI, including improved decision-making, reduced legal costs, and increased brand equity. We have developed an ethical risk framework that we consistently apply We have considered ethics and bias risks but do not have a formal framework We have yet to consider ethical and bias risk, though we plan to How have you considered ethical and bias risks associated with AI? Note: 51% of respondents answered "don't know/not applicable" Neil White Digital IA Lead Principal Deloie & Touche LLP [email protected] Michael Koppelmann Senior Manager Deloie & Touche LLP [email protected] Geoffrey A. Kovesdy Digital IA Principal Deloitte & Touche LLP [email protected] Martin Rogulja Senior Manager Deloitte & Touche LLP [email protected] Alexey Surkov Ethical AI Partner Deloitte & Touche LLP [email protected] Ryan Hittner Ethical AI Managing Director Deloitte & Touche LLP [email protected] Michael Schor Lead IA Innovation Partner Deloitte & Touche LLP mschor@deloitte.com Michelle Pham Senior Manager Deloitte & Touche LLP [email protected] Internal Audit Ethical AI Digital Program Assurance Metrics Risk 0% 5% 10% 15% 20% 25% A lack of skills and experse among auditors and lack of a formal audit methodology framework emerge as the greatest challenges organizaons face when auding advanced digital capabilies. Both relate to the queson: how do you help your business users who may not be tech-aware beer understand the technology so they can work hand in hand to drive digital transformaon? By focusing on building awareness and educaon and providing end users with the required skillsets, organizaons can elevate digital fluency and give auditors and decision-makers the tools they need. 8% 8% 22% 18% Lack of skills and experse among auditors Lack of formal methodology and framework Inability to review the code Inability to review design documentaon What is your organizaon’s biggest challenge while auding automaon, metrics, and/or AI? Note: 44% of respondents answered “don’t know/not applicable” 23% 17% 16% Note: 44% of respondents answered “don’t know/not applicable” 0% 5% 10% 15% 20% 25% With the growth of digital investment, an opportunity exists for many organizaons to develop a forward-looking framework rather than a rearview-mirror approach to digital risks, taking command of their risk management and remaining strategically posioned along with the 23% who already audit these risks. When building that framework, people typically think of IT risk, but should think more broadly and address all major areas where risks occur: - Automaon strategy and governance: Guiding principles, expected ROI, management engagement, and monitoring - Digital operang model: Opportunity idenficaon, priorizaon, development, and deployment - Business unit: Impact of automaon on current operaons and roles/responsibilies Yes No, but we plan to in the next 12 months No, and we do not plan to Does your organizaon’s internal audit team audit the risks associated with the use of advanced digital capabilies (e.g., machine learning, roboc process automaon)? 0% 5% 10% 15% 20% 25% 30% 35% 12% 31% 6% 30% The majority of respondents, nearly 75%, report that their organizaons have begun to take advantage of the opportunies presented by digital technologies, though significant diversity exists in the organizaons’ levels of advancement. Wherever your organizaon falls in the process of digital transformaon, effecve end-to-end governance of these technologies remains crical. Building bots is only the start; true value and impact derive from defining the right operang model and effecvely managing the process, operaons, employees, and risk ed to the automaon. As more organizaons move from absent or basic toward advanced, IA should play a key role, not only to reacvely monitor gauges and warning lights but to proacvely help chart the course ahead. *Note: 21% of respondents answered “don’t know/not applicable” Advanced - We currently leverage analycs, data visualizaon, roboc process automaon, and other types of advanced digital technologies Building - We currently leverage basic data analycs, data visualizaon, and roboc process automaon Basic - We currently leverage basic data analycs, data visualizaon, and roboc process automaon Absent - We do not currently leverage digital capabilies, nor do we have plans to do so How would you describe your organizaon’s adopon and leverage of digital capabilies (e.g., analycs, machine learning, roboc process automaon)? Driving the digital age Scaling digital programs through effecve risk management With the acceleraon and proliferaon of digital technologies such as Roboc Process Automaon (RPA) and Arficial Intelligence (AI), the road ahead holds vast opportunies for organizaons. As humans and machines collaborate to drive strategic outcomes, are management and Internal Audit (IA) equipped and posioned to navigate the new risk terrain of this evolving technology landscape to help ensure that their stakeholders are maximizing the value from these capabilies while effecvely managing risk? During a November 2020 Dbriefs webcast, Deloie discussed an overview of emerging technologies and effecve risk management techniques for digital transformaons, specific risks associated with metrics involved in external reporng and internal monitoring, and Trustworthy AI™. During this webcast, Deloie also surveyed nearly 3,000 professionals about the extent of their organizaons’ digital transformaon, IA’s level of involvement, their greatest challenges in auding advanced digital capabilies, and their approaches to ethical concerns surrounding AI. Here’s what they had to say. In a recent Deloie survey1, 83% of execuves said AI will be very or crically important to their business success in the next two years, and 95% said they have concerns around ethical risks arising due to AI. As AI proliferates, organizaons must work toward AI that delivers on transparency, privacy, and imparality. Source: Dbriefs, “AI risk and rewards: Striking the right balance for your organizaon” (Sept. 30, 2020) As your company accelerates its digital transformation, allow Internal Audit to help drive value through effective risk management. Visit our website or contact your Deloitte professional to discuss more on elevating your Internal Audit function.
Transcript of Driving the digital age - deloitte.com
About DeloitteThis publication contains general information only and Deloitte is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This publication is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor.
Deloitte shall not be responsible for any loss sustained by any person who relies on this publication.
As used in this document, “Deloitte” means Deloitte & Touche LLP, a subsidiary of Deloitte LLP. Please see www.deloitte.com/us/about for a detailed description of our legal structure. Certain services may not be available to attest clients under the rules and regulations of public accounting.
Copyright © 2021 Deloitte Development LLC. All rights reserved
0% 10% 20% 30% 40% 50% 60%
20%
11%
18%
With only 11% of respondents formally addressing ethics and bias concerns, a large opportunity exists to capture the benefits of trustworthy AI, including improved decision-making, reduced legal costs, and increased brand equity.
We have developed an ethical risk framework that we consistently apply
We have considered ethics and bias risks but do not have a formal framework
We have yet to consider ethical and bias risk, though we plan to
How have you considered ethical and bias risks associated with AI?
Note: 51% of respondents answered "don't know/not applicable"
Neil WhiteDigital IA Lead PrincipalDeloitte & Touche LLP [email protected]
Michael Koppelmann Senior ManagerDeloitte & Touche LLP [email protected]
Geoffrey A. Kovesdy Digital IA Principal Deloitte & Touche LLP [email protected]
Martin Rogulja Senior Manager Deloitte & Touche LLP [email protected]
Alexey Surkov Ethical AI PartnerDeloitte & Touche LLP [email protected]
Ryan Hittner Ethical AI Managing Director Deloitte & Touche LLP [email protected]
Michael Schor Lead IA Innovation Partner Deloitte & Touche LLP [email protected]
Michelle Pham Senior Manager Deloitte & Touche LLP [email protected]
Internal Audit Ethical AI Digital Program Assurance Metrics Risk
0% 5% 10% 15% 20% 25%
A lack of skills and expertise among auditors and lack of a formal audit methodology framework emerge as the greatest challenges organizations face when auditing advanced digital capabilities. Both relate to the question: how do you help your business users who may not be tech-aware better understand the technology so they can work hand in hand to drive digital transformation? By focusing on building awareness and education and providing end users with the required skillsets, organizations can elevate digital fluency and give auditors and decision-makers the tools they need.
8%
8%
22%
18%
Lack of skills and expertise among auditors
Lack of formal methodology and framework
Inability to review the code
Inability to reviewdesign documentation
What is your organization’s biggest challenge while auditing automation, metrics, and/or AI?
Note: 44% of respondents answered “don’t know/not applicable”
23%
17%
16%
Note: 44% of respondents answered “don’t know/not applicable”
0% 5% 10% 15% 20% 25%
With the growth of digital investment, an opportunity exists for many organizations to develop a forward-looking framework rather than a rearview-mirror approach to digital risks, taking command of their risk management and remaining strategically positioned along with the 23% who already audit these risks.
When building that framework, people typically think of IT risk, but should think more broadly and address all major areas where risks occur:- Automation strategy and governance: Guiding principles, expected ROI, management
engagement, and monitoring- Digital operating model: Opportunity identification, prioritization, development, and
deployment- Business unit: Impact of automation on current operations and roles/responsibilities
Yes
No, but we plan to in the next 12 months
No, and we do not plan to
Does your organization’s internal audit team audit the risks associated with the use of advanced digital capabilities (e.g., machine learning, robotic process automation)?
0% 5% 10% 15% 20% 25% 30% 35%
12%
31%
6%
30%
The majority of respondents, nearly 75%, report that their organizations have begun to takeadvantage of the opportunities presented by digital technologies, though significant diversityexists in the organizations’ levels of advancement. Wherever your organization falls in theprocess of digital transformation, effective end-to-end governance of these technologiesremains critical. Building bots is only the start; true value and impact derive from defining theright operating model and effectively managing the process, operations, employees, and risktied to the automation.
As more organizations move from absent or basic toward advanced, IA should play a key role,not only to reactively monitor gauges and warning lights but to proactively help chart thecourse ahead.
*Note: 21% of respondents answered “don’t know/not applicable”
Advanced - We currently leverage analytics, data visualization, robotic process automation, and other types of advanced digital technologies
Building - We currently leverage basic data analytics, data visualization, and robotic process automation
Basic - We currently leverage basic data analytics, data visualization, and robotic process automation
Absent - We do not currently leverage digital capabilities, nor do we have plans to do so
How would you describe your organization’s adoption and leverage of digital capabilities (e.g., analytics, machine learning, robotic process automation)?
Driving the digital ageScaling digital programs through effective risk managementWith the acceleration and proliferation of digital technologies such as Robotic Process Automation (RPA) and Artificial Intelligence (AI), the road ahead holds vast opportunities for organizations. As humans and machines collaborate to drive strategic outcomes, are management and Internal Audit (IA) equipped and positioned to navigate the new risk terrain of this evolving technology landscape to help ensure that their stakeholders are maximizing the value from these capabilities while effectively managing risk?
During a November 2020 Dbriefs webcast, Deloitte discussed an overview of emerging technologies and effective risk management techniques for digital transformations, specific risks associated with metrics involved in external reporting and internal monitoring, and Trustworthy AI™. During this webcast, Deloitte also surveyed nearly 3,000 professionals about the extent of their organizations’ digital transformation, IA’s level of involvement, their greatest challenges in auditing advanced digital capabilities, and their approaches to ethical concerns surrounding AI. Here’s what they had to say.
In a recent Deloitte survey1, 83% of executives said AI will be very or critically important to their business success in the next two years, and 95% said they have concerns around ethical risks arising due to AI. As AI proliferates, organizations must work toward AI that delivers on transparency, privacy, and impartiality.
Source: Dbriefs, “AI risk and rewards: Striking the right balance for your organization” (Sept. 30, 2020)
As your company accelerates its digital transformation, allow Internal Audit to help drive value through effective risk management. Visit our website or contact your Deloitte professional to discuss more on elevating your Internal Audit function.
