Integrated Audit in the Digital Era: Definition, Differences, and Methods

A decade ago, it was unusual for audits to be involved in evaluating data security risk and controls. However, in today’s digital enterprises, data have emerged as critical organizational assets that face the most significant security threats. The IT and security functions cannot combat these threats in siloes. The audit team is an essential ally and must join forces with IT in association with the board of directors (BoD), management and frontline teams to build a truly integrated and robust cybersecurity strategy that focuses on anticipating and mitigating risk and building cybersecurity resilience. 

Traditionally, internal audits were limited and associated with gaining information about financial systems and the financial records of an organization or a business and conducting audits. However, now under the digitized environment audit scope includes non-financial subject areas, such as financial, operational, IT, compliance, regulatory, safety and security of information systems, and environmental concerns. As a result, specialized security audits, Information System Audits, and environment audits are conducted. Integrating these audits into a single audit produces a more effective outcome through a holistic approach.

Integrating Audit
Keeping the objective of integrating audit, it is useful to keep the following in view-
  • A cybersecurity audit is a comprehensive assessment and analysis of an organization\'s cybersecurity and cyber risks. The objective of a cybersecurity audit is to proactively identify vulnerabilities, threats, and associated mitigation options to prevent weaknesses from being exploited.
  • Keeping at bay cyber-attacks would be difficult keeping in view the magnitude of the stretch of IT infra, IT networks, connected devises/ applications, which are ever increasing in this era of digitization.
Some possible methods to overcome the issues in this digitization era would be to – 
  • Create common repository of issues/vulnerabilities, risks and controls across the various IT infra, processes/SOPs, IT related business processes including processes handled by 3rd party in some ecosystems.
  • Have an approach to integrate the findings of various applicable frameworks such as PCI-DSS, HIPPA, ISO, SOC2, DPDP, GDPR etc.
What is an Integrated Audit? 
An integrated audit considers the relationship between information technology, financial and operational controls in establishing an effective and efficient internal control environment. Even though issues may not be identified in financial and operational controls, issues identified in information technology may negate the effectiveness of the financial and operational controls and visa-versa. Therefore, an integrated audit evaluates the interplay between financial, operational and technology processes on the achievement of control objectives.
The following areas are generally examined during an integrated audit :
  • The business and information processing risks and controls are understood and agreed upon by the business owners, information technology delivery and support organization, and the integrated audit team.
  • Manual and automated feeds, system interfaces, and communications are accurate, timely and secure.
  • Manual and automated transactions are approved, timely and accurately processed.
  • Information is secure and confidentiality controls follow current regulations and University standards.
  • Disaster recovery plans and business continuity plans provide reasonable assurance that both the system and business operations can recover and continue when a system or business interruption occurs.
  • Program changes are authorized, tested, approved and migrated to production as prescribed by the business process owners.

Some pointers given below assist in achieving the integration to some extent –
  1. Adopting an Integrated Approach to IT and Security Auditing
  2. Frameworks for Integration
  1. Adopting an Integrated Approach to IT and Security Auditing
    Design, develop, maintain a common repository for audit, risk and IT. Whatever issues are observed in any of the IT infra, IT processes/ SOP, IT related business process along with the risks and controls keep it in a consistent manner to institutionalise the repository and bring consistency/ standardisation to the repository. Having a centralized data repository enables IT teams to easily maintain, access and share crucial data. Teams can also map security risk areas to auditable entities, IT assets, controls and regulations across jurisdictions. This tightly integrated data model should allow audit and IT teams to determine how a cybersecurity risk or ineffective control could impact the enterprise so they can provide recommendations proactively to resolve the issue.
  2. Frameworks for Integration
    To best plan for an integrated audit, an organization must first make sure the scope of testing environment is going to be similar for the applicable frameworks. Once scope is defined, organizations can then work to understand similar controls that can be tested across the enterprise. In many cases, organizations start with security policies and procedures since these tend to apply to the organization as a whole, and then consider the technical testing of network systems for further efficiency gains.
Almost any framework can be approached in an integrated fashion. The most important aspect is that scopes align as closely as possible. The most common standards, frameworks and regulations that can be integrated are International Standards Organization (ISO) standard ISO 27001, SOC 2 Type 2, Payment Card Industry (PCI) Report on Compliance (ROC), and the US Health Insurance Portability and Accountability Act (HIPAA). An example of an organization that may leverage the aforementioned frameworks is a billing service provider for a healthcare vertical. 

In that case, the organization would be required to comply with HIPAA due to its relationship to the healthcare provider the payment card industry because it accepts credit cards for payments and ISO 27001 and SOC 2 Type 2 because of internal security demands that would require ISO and SOC audits to test processes and systems. Organizations that can align scope with these standards, frameworks and regulations gain a significant amount of efficiency in testing and a greater visibility into their overall security postures and compliance obligations.

Advantage over traditional method -
  1. Integrating audits also eases strain on audit teams and IT/engineering staff, as evidence gathered can be tested once and used across applicable frameworks that share scope instead of gathering it at different times of year. Gaining efficiency by cross-testing shared controls frees resources to focus on day-to-day operations instead of needing to be in perpetual audit mode throughout the year. 
  2. Currently the various frameworks are audited/ assessed on individual basis even though many frameworks may be applicable to the entity under cyber audit/ assessment. The relevant audits for say cards (PCI-DSS), Patients data (HIPPA), assessment of internal security standards say ISO 27001 and SOC2, applicable regulatory/ best practices standards for data protection (GDPR/ DPDP) may be conducted individually. The approach of individually conducting these audits if changed to integrating these approaches would assist in making the approach more structured and efficient.   
The digital era demands a departure from siloed auditing methods to a more integrated approach. Establishing a common repository for issues, risks, and controls, coupled with aggregating the outputs of relevant frameworks under a single umbrella, equips organizations with the agility to adapt to digital transformation. Integrated audits not only reflect the current necessities but also pave the way for future-proofing audit strategies against the backdrop of ever-evolving digital landscapes.

Ready to Elevate Your Audit Process?
Today, complex and fast-paced digital business environment, adopting an integrated audit approach is not just beneficial—it\'s essential. Whether you\'re aiming to bolster your cybersecurity resilience, streamline your operational efficiency, or ensure comprehensive compliance, an integrated audit provides the holistic oversight necessary to achieve these goals.

Contact us today to explore how our expert audit services can transform your organizational strategy, mitigate risks, and pave the path to a secure and compliant future.

Let\'s build a robust control approach together.

LinkedIn Youtube

We use cookies to enhance your user experience. By continuing to browse, you hereby agree to the use of cookies. Know more Privacy Policy & Cookies Policy.