globaliia.org Update on The IIA And The State of The Global Profession Richard F. Chambers, President & CEO The Institute of Internal Auditors

globaliia.org Overview The Global IIA Footprint in 2015 The Global Headquarters Update Key Trends in The Global Profession

globaliia.org The IIA Global Footprint in 2015

globaliia.org Source of Data Global Membership Data (February 2015) 1 Global Certification Data (March 2015) Global Financial Reports (2014) Annual Institute Activity Reports (2015) 234

globaliia.org The Global IIA in ,000+ MEMBERS 170 COUNTRIES 106 INSTITUTES 159 CHAPTERS

globaliia.org Institutes by the Numbers By Region By Associated Organization

globaliia.org Members By Regions February 2015 *North America includes US, Canada and chapters in Caribbean

globaliia.org Members by Primary Language

globaliia.org 5-Year Regional Membership Trends - 2%- 1% + 10% + 21% + 16% + 5%

globaliia.org 5-Year Global Membership Trend +16,000 members +9%

globaliia.org Global Certifications & Designations March 2015 CIA: 130,000 CRMA: 14,200 CCSA: 6,700 CFSA: 6,200 CGAP: 3,900 QIAL: 45

globaliia.org 2014 Global Financial Position $138.9 million in global revenue, 3% increase $11.4 million of net contribution, -10% increase $151 million in total assets, 10% increase $110.2 million in net assets, 10% increase * Combined statistics from Institutes, NA Chapters, and IIA Global HQ for FY ending in 2014

globaliia.org Top Revenue Components Worldwide Membership 32% Global Certifications 7% Seminars & Conferences 46%

globaliia.org Development of the Profession (% of Countries in Each Region) Source: 2014 Activity Reports

globaliia.org IIA Global Headquarters Update

globaliia.org 2014 Was a Year of New Initiatives Since the 2014 Global Council, IIA Global HQ launched: The Qualification in Internal Audit Leadership (QIAL) The Risk Resource Exchange Internal Auditor Magazine’s Optimized Website Prototypes for Future Global Services: Career Map The American Center for Government Auditing (ACGA) Finalized MRA’s with 105 institutes Hosted London International Conference Exposed “IPPF Relook” recommendations Facilitated a new Global Strategic Plan Released 9 Research Foundation reports and 7 educational products & books

globaliia.org In 2015 – More New Initiatives We Plan to Launch: –International Chapter Program –Global Thought Leadership Series –IIA Global SmartBrief –Part 1 CIA Reciprocity –ACCA Challenge We also Plan to: –Introduce the Self-directed Learning Platform for Institutes –Pilot Global Application for Career Map –Craft the African Development Initiative –Host the International Conference in Vancouver

globaliia.org IPPF: Enhancements Addition of: –The Mission of Internal Auditing –The Core Principles for the Professional Practice of Internal Audit –Capability to produce Emerging Issues content (not part of IPPF) Introduction of: –Implementation Guidance (replaces/enhances Practice Advisories) –Supplemental Guidance (replaces/enhances Practice Guides) Removal of Position Papers from IPPF Renaming Key Element: –Strongly Recommended to Recommended –(no change to Mandatory elements)

globaliia.org The Revised IPPF

globaliia.org IPPF Enhancements: Next Steps 3/2015 IIA Global Board Approval 5/2015 Final Report – Available for Translation 7/2015Final Report – Issued 7/2015Proposed Launch IPPF (Vancouver) 7/2015 – 12/2016 Implementation and conversion activities For more information: For more information:

globaliia.org CBOK 2015: Practitioner Survey Update Over 14,500 responses –2,586 CAEs and 1,457 Directors / Sr. Managers –3,725 Financial Services; 871 Public Sector –2,737 NOT IIA members Regional participation

globaliia.org CBOK Key Dates & 2016 Practitioner Study –Publish first results – Vancouver July 2015 –Data visualization tool launch – Q Stakeholder Study –Study begins – Q –Publish first results – Q1 2016

globaliia.org Join us in Vancouver next year for: Mountains of Opportunities…. Oceans of Change Visit for detailswww.ic.globaliia.org Vancouver 2015

globaliia.org 2014: Key Trends in Internal Audit

globaliia.org 2015 Global Survey Demographics Conducted in Collaboration with CBOK, March 2015 –7th consecutive year –Nearly 70% public/ private companies –Over 3900 responses from heads of internal audit and audit directors Data as of 27 March 2015 Geographic Distribution –29% Europe –22% North America –13% Latin America –23% Asia Pacific – 7% Africa – 7% Middle East Key Industries –30% Finance and Insurance –14% Manufacturing –8% Public Administration –5% Health Care

globaliia.org Preliminary Thoughts from the CBOK/Pulse Data The resource outlook is strong The profession’s focus remains diverse More emphasis is needed to audit at “the speed of risk” Talent profiles are continuing to evolve The emphasis on quality assurance is lagging

globaliia.org Outlook for Internal Audit Resources Remains Strong Budgets: Staffing: IncreaseStableDecrease Overall 40%48%12% Change from IncreaseStableDecrease %57%12% %59%5% Changes Experienced and Projected Source: “The Pulse of the Profession: © 2014 The IIA Audit Executive Center Source: The Global Pulse of Internal Audit Survey Conducted in collaboration with the 2015 Common Body of Knowledge Study, © 2015 The IIA and The IIA Research Foundation. All rights reserved. No part of this data may be copied, reproduced or otherwise disseminated without explicit permission from The IIA.

globaliia.org Despite Resource Growth – Concerns remain Sufficiency of funding for internal audit compared to responsibilities? –Not sufficient at all – 14% –Somewhat sufficient – 52% –Completely sufficient – 31% In addition – 40 percent have used a third-party provider to augment staff 28 percent have formal or informal rotation programs Source: The Global Pulse of Internal Audit Survey Conducted in collaboration with the 2015 Common Body of Knowledge Study, © 2015 The IIA and The IIA Research Foundation. All rights reserved. No part of this data may be copied, reproduced or otherwise disseminated without explicit permission from The IIA.

globaliia.org Operational 24% Compliance/ Regulatory 15% Financial 10% Business Strategy 11% Risk Mgt Effectiveness 12 % Information Technology 8% Corporate Governance 6% Other 9% Fraud 4% 2015 Audit Plans Continue to Diversify to Address Key Risks Source: The Global Pulse of Internal Audit Survey Conducted in collaboration with the 2015 Common Body of Knowledge Study, © 2015 The IIA and The IIA Research Foundation. All rights reserved. No part of this data may be copied, reproduced or otherwise disseminated without explicit permission from The IIA.

globaliia.org More Emphasis Needed to Audit at the “Speed of Risk” Only 48 percent rely on comprehensive risk assessments by internal audit –18 percent on management’s risk assessments –26 percent on focused risk assessments When developing the internal audit plan: –21 percent develop once per year – do not update –43 percent develop and update 1-2 times per year –18 percent develop and update 3 or more times –Only 15 percent consider their plans “highly flexible” Only 21 percent “continuously” assess risks Source: The Global Pulse of Internal Audit Survey Conducted in collaboration with the 2015 Common Body of Knowledge Study, © 2015 The IIA and The IIA Research Foundation. All rights reserved. No part of this data may be copied, reproduced or otherwise disseminated without explicit permission from The IIA.

globaliia.org Talent Profiles are Continuing to Evolve SKILLS BEING RECRUITEDRATE 1Analytical/critical thinking66% 2Communication53% 3Risk Management Assurance42% 4Accounting42% 5IT - General38% 6Industry Specific Knowledge37% 7Data Mining and Analysis33% Source: The Global Pulse of Internal Audit Survey Conducted in collaboration with the 2015 Common Body of Knowledge Study, © 2015 The IIA and The IIA Research Foundation. All rights reserved. No part of this data may be copied, reproduced or otherwise disseminated without explicit permission from The IIA.

globaliia.org The Emphasis on Quality Assurance is Lagging How developed is your Quality Assurance and Improvement Program? –28% – non-existent or ad hoc –34% – in the process of development –33% – well-defined; including an external assessment Source: The Global Pulse of Internal Audit Survey Conducted in collaboration with the 2015 Common Body of Knowledge Study, © 2015 The IIA and The IIA Research Foundation. All rights reserved. No part of this data may be copied, reproduced or otherwise disseminated without explicit permission from The IIA.

globaliia.org Questions? The Institute of Internal Auditors Richard Chambers, CIA, QIAL, CGAP, CCSA, CRMA President & Chief Executive