Does the audit profession need reinvention
Is post mortem analysis meaningless
In business moving at the speed of thought.
The world moved slowly. Companies took a few months to finalise their accounts. Nothing much charged from one year to the next. Audit was about accounts. We called it statutory audit. And the professionals who did it were called Chartered Accountants. They did a post mortem on a year gone by. And they dug out a skeleton or two. And the client paid them. And stakeholders hoped that what they got was a full and fair picture of the financial health of the company. The Indian Institute of Chartered Accountants regulated the profession by ensuring CAs did nothing other than their profession, did not advertise and did not solicit business.
To cut a long story short, we build a large base of professionals who today serve no useful purpose. And everything they do can be done by ai.
Well meanjng youngsters join the profession. Uphold independence. Protect governance. Add value. Can’t ask too many uncomfortable questions. And don’t get commensurate authority, compensation or respect.
We have to replace statutory financial audit with something that is internal, concurrent and all encompassing. Something that looks at things that matter as much as, if not more than accounting.
Areas like cybersecurity, ai, climate change, compliance management, waste reduction, governance…. It’s a long list. And I think a good term for this service is “internal audit”. Something that maybe we can create a role for within a company but with external checks. As opposed to a CA who is external to a company and has no checks (though NFRA is trying hard)
Globally, The Institute of Internal Auditors (IIA) has done commendable work in building global standards, ethics, and professional certification. Internal audit is positioned as a cornerstone of governance.
Yet on the ground, a contradiction persists:
• Internal auditors are expected to challenge management
• Safeguard shareholder and public interest
• Strengthen risk culture and controls
…while often being treated as a cost centre, not a value creator.
If internal audit truly matters:
• Independence must be real, not cosmetic
• Audit committees must empower, not overrule
• Compensation, stature, and career paths must reflect responsibility
You cannot demand courage, integrity, and professional judgment
while pricing the role as if it were optional.
Strong governance is not free.
And ethical assurance cannot be built on unpaid—or underpaid—conviction.
So we need to develop a brand new profession. A multidisciplinary one which covers financials, environment, Human Resources, cyber security, data privacy, ai human balance, digital and several other areas.
And this needs blue sky thinking.
And serious research. PhD level.
This is a role which is different from any right now. But all encompassing.
How many PhDs do the Big4 employ?
Why don’t we have deep tech here ?
