IIA: Internal Audit Leaders Need to Recruit More Tech-Savvy Accounting Talent
The Institute of Internal Auditors (IIA) released a research report sponsored by Deloitte on Monday, recommending that internal audit leaders hire more tech-savvy and resilient new employees to address disruptive innovation. The report shows that the number of accounting graduates has declined for six consecutive years, while internal audit departments show the strongest preference for accounting backgrounds (80%) in hiring, but only 43% for computer science and technology backgrounds. IIA CEO Anthony Pugliese emphasized that technological developments require internal audit to expand its talent pool and place importance on soft skills such as leadership and communication.
Core Summary
- The Institute of Internal Auditors (IIA) said on Monday that companies hiring internal auditors should prepare for disruptive innovation by employing more workers who are technologically savvy and able to challenge business strategy.
- In a study sponsored by Deloitte, the IIA noted that internal audit leaders "face a critical task: ensuring a steady supply of qualified new employees amid labor shortages, existing competition, and new potential disruptive business models."
- "To keep the profession healthy, the next generation of internal auditors must be more technologically proficient, innovative, and resilient than their predecessors," the IIA said. "Finding, training, and retaining these 'super auditors' is no easy task."
Deep Insights
For years, demand for accountants in auditing and other roles has exceeded supply, and this imbalance is unlikely to end in the near term.
According to data from the American Institute of Certified Public Accountants (AICPA), the number of accounting graduates at the end of the 2021-2022 academic year fell 7.4% from the previous period, accelerating a six-year decline in entrants to the profession. Among them, the number of graduates with bachelor's degrees fell 7.8% from 2020-2021, and those with master's degrees fell 6.4%. At the end of the 2020-2021 academic year, bachelor's and master's degree awards had already declined 2.8% and 4.7%, respectively, from the prior period.
The IIA noted that internal audit leaders are trying to draw from a limited talent pool in both accounting and technology.
"Internal audit is competing with some well-known names in the tech industry for graduates with backgrounds in artificial intelligence, cybersecurity, and data analytics," IIA CEO Anthony Pugliese said in a statement. Additionally, "we are seeing hiring managers place increasing importance on soft skills related to leadership and communication," he added.
Over the past five years, internal audit leaders have most preferred to hire college graduates who studied accounting, with 80% of respondents citing this undergraduate major, the IIA said. Preferences for internal audit and general business majors were 53% and 44%, respectively, while preference for computer science and technology majors was only 43%.
"The evolution of the technology and risk landscape has accelerated the need for internal audit to expand its talent and recruitment channels," Pugliese said.
The IIA noted that in recruitment, internal audit leaders need to prepare for disruption from new technologies such as artificial intelligence and robotic process automation. These innovations will free some employees to take on higher-value work, while also prompting some to leave the profession.
"New technologies are bound to reshape the entire internal audit workforce," the IIA said. "Internal audit will move beyond a simple assurance function toward a broader focus on advisory and business strategy."