Report: Internal Audit Profession Must Embrace AI to Effectively Navigate the Era of Hypervolatility

AuditBoard report identifies key pressures facing internal audit, explores the role and opportunity of AI, and how teams can thrive in today’s complex environment.

AuditBoard, the leading AI-powered global platform for connected risk, announced the findings of its 2026 Focus on the Future report, revealing the internal audit profession is navigating an environment of hypervolatility defined by accelerating, interconnected risks. The survey of 213 global internal audit leaders shows the profession is being challenged by three converging forces: persistently tight resources, the rise of AI, and a demand for role redefinition.

The report highlights internal auditors must overcome resource limitations by leveraging AI as a capacity multiplier while simultaneously upskilling their teams to provide greater value. This is the only way the function can thrive in this next-generation environment.

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Key findings: converging pressures on the internal audit profession
The survey identifies a dangerous gap between aspiration and capability, driven by these core challenges:

• AI readiness lags execution: Only 39 percent of internal audit leaders say AI will significantly transform the profession within five years. At the same time, readiness to provide assurance over AI lags behind adoption. Only 28 percent of leaders express confidence in their teams’ ability to effectively audit AI risks, and 63 percent of organizations have not yet defined a formal risk appetite or governance framework for AI use, leaving internal auditors with little structure for oversight.
• The resource paradox: Internal audit continues to face expanding responsibilities with stagnant or shrinking budgets. 43 percent of respondents reported no change in their 2025 budgets compared to 2024, and 18 percent reported reductions. Staffing levels followed a similar pattern, with 57 percent maintaining flat full-time headcounts despite expanding mandates.
• The identity crisis persists: Over half of the respondents aspire to be recognized as trusted advisors, yet fewer than a quarter currently feel their departments are perceived in this way. This is a critical vulnerability, as functions viewed purely as compliance enforcers risk being rendered irrelevant by automation.

Keeping a competitive edge
While AI can enhance efficiency, it cannot replicate the unique qualities that distinguish outstanding auditors. The survey identified the top skills differentiating auditors in 2026 and beyond:

• Professional skepticism and inquisitiveness
• Relationship-building and communication
• Ethical judgment
• Critical thinking

“Internal audit stands at a tipping point. The pressures outlined in the report create unprecedented risk for the future of the profession,” said Richard Chambers, Senior Advisor, Risk and Audit, AuditBoard. “To thrive amid hypervolatility, internal auditors should utilize AI to automate routine tasks, freeing up teams to focus on more specialized tasks and move beyond merely reporting what is happening to become the foresight-driven strategic partners the business needs.”