Four Essential Skills for Auditors in the Next Normal Era
The role of auditors is rapidly evolving due to technological advancements, regulatory changes, and global challenges like the COVID-19 pandemic. As we enter the "Next Normal" era, auditors need to be equipped with key skills to effectively operate in this complex environment.
The author has summarized several research studies (see references) conducted between 2020-2023.
The authour synthesizes four essential skills for auditors: Flexibility, Resilience, Adaptability, and Forward Thinking.
Currently, Supreme Audit Institutions around the world are facing new challenges referred to as the BANI World. This concept, introduced by Jamai Casio, highlights a shift from the VUCA (Volatility, Uncertainty, Complexity, Ambiguity) world to the BANI (Brittle, Anxious, Non-Linear, Incomprehensible) world. These changes are both rapid and intense. Examples of each component of BANI are as follows:
Brittle
Brittleness refers to systems or structures that appear strong but can easily collapse under pressure. For example, complex financial systems that crash quickly during a financial crisis or communication networks that fail during a cyberattack.
Anxious
Anxiety arises from uncertainty and lack of clear information. For example, during the COVID-19 pandemic, people were anxious about health, jobs, and an uncertain future. This anxiety can lead to poor decision-making or inaction.
Non-Linear
Non-linearity involves events or impacts that are unpredictable and do not follow familiar patterns. Examples include sudden disease outbreaks or technological shifts that disrupt businesses and industries unexpectedly.
Incomprehensible
Incomprehensibility refers to situations that are too complex to fully understand. This could be the multifaceted causes of climate change or the intricate workings of advanced artificial intelligence algorithms.
In this context, the four essential skills for auditors to cope with the BANI World are:
1. Flexibility
Flexibility involves being open to new ideas and willing to adjust strategies as situations change. This skill helps auditors manage multiple tasks efficiently, prioritize effectively, and handle unexpected issues. In a brittle and non-linear world, auditors must quickly adapt and be flexible to cope with changing circumstances.
2. Resilience
Resilience is the ability to recover from setbacks and continue working effectively. Auditors often face challenges such as data breaches or regulatory changes. Being resilient allows them to navigate these problems and maintain their performance. In an anxious and incomprehensible world, quick recovery is crucial for auditors to remain effective.
3. Adaptability
Adaptability is crucial in the Next Normal era as regulations, technology, and organizational changes occur rapidly. Auditors must learn and integrate new tools and methods to work effectively in ever-changing situations. In a non-linear and incomprehensible world, adaptability helps auditors address challenges efficiently.
4. Forward Thinking
Forward Thinking involves anticipating future trends and challenges. Auditors who think ahead can prepare for potential issues and implement effective solutions before problems arise. In a brittle and anxious world, forward thinking enables auditors to proactively address and prevent issues.
Flexibility, resilience, adaptability, and forward thinking all reflect the problem-solving abilities of auditors in a modern world. These skills enable auditors to handle unexpected situations and play a crucial role in the success of their organizations in a dynamic environment.
In the Next Normal era, auditors must develop specific skills to operate effectively in a changing environment. The four essential skills—Flexibility, Resilience, Adaptability, and Forward Thinking—will help auditors work efficiently and add value to their organizations amidst continuous change.
Dr. Sutthi Suntharanurak
©️References
"The Future of Audit: Trends and Innovations for 2023 and Beyond" by QX Accounting
"What Skill Do You Need to Become a Great Auditor?" by Audit International
"The Changing Face of Audit Talent" by Thomson Reuters Tax and Accounting
"Auditor Skills in a Changing Business World" by ICAS and the UK Financial Reporting Council
"The Future of Auditing: Emerging Trends and Challenges" by LinkedIn
