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What is Agile: Definition, Stages, and How It Works in Auditing


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In audit, whether internal or other audits, there are several kinds of methods that serve to make auditing easier. These methods organize the audit into several stages. One audit method that has its own stages is the agile audit method.

As the name implies, agile auditing is a method that is used in a fast and smart way. This makes the agile audit method a fast and adaptable method in all situations because it is done in a short period of time.

This method involves fast and agile planning and application, while remaining structured. Such applications make agile auditing an audit that improves governance and strengthens oversight of new risks that occur in dynamic situations.

In this article, the author will explain how the agile method works in the audit process, starting from its general and specific definitions, to the stages that must be carried out and how it works.

Definition of Agile According to Experts

Agile is a software development methodology that focuses on collaboration, user involvement, and continuous delivery.

This methodology emphasizes short development cycles (called sprint) that allows the team to adapt to changes and improve the quality of the final product.

In the context of auditing, agile is defined as an audit approach that focuses on short audit cycles and continuous audit engagement. This approach allows auditors to adapt to change and improve audit effectiveness.

Here are some specific definitions of agile auditing.

A. According to IIA (Institute of Internal Auditors)

Agile auditing is an audit approach that focuses on short audit cycles, continuous audit engagement, and the use of technology.

B. According to PwC

Agile auditing is an audit approach that combines agile principles with traditional audit practices.

C. According to KPMG

Agile auditing is an audit approach that focuses on collaboration between auditor and auditing, the use of technology, and continuous delivery. In general, agile auditing has the following characteristics:

1. Short audit cycle

Agile audits are usually conducted in short audit cycles, which allows auditors to interact more frequently with the auditee and get feedback faster.

2. Ongoing auditory engagement

Agile auditing involves auditors continuously in the audit process. Auditors are given the opportunity to provide feedback and contribute to the development of the audit plan.

3. Use of technology

Agile auditing uses technology to improve audit efficiency and effectiveness. The technologies used may include audit software, collaboration tools, and data analysis.

Agile auditing is the right auditing approach for organizations that want to increase the efficiency and effectiveness of their audits, improve the quality of their audits, and increase their audit satisfaction.

Stages in the Agile Audit Method

In agile auditing, there are several stages that are useful to facilitate the audit process by auditors. The process is as the name implies, where all stages are carried out in a fast and thorough process. The following are the stages in the agile audit method.

1. Planning

Understanding the Audit Objective and Scope, where the initial stage involves collaborating with the auditor to understand the audit objective, audit scope, audit risks, and measurable time frame.

Audit Team Formation, where the audit team is formed by appointing members and defining their roles and responsibilities.

Audit Plan Development, at this stage a comprehensive audit plan is developed, including the audit cycle, audit procedures, and audit tools to be used.

2. Reception

Submission of Notisi Audit, containing information regarding the audit objectives, scope, and schedule.

Discussion and Feedback, is an open discussion conducted with the auditor to review the audit plan, receive feedback, and ensure access to necessary documentation.

3. Implementation

Implementation of Audit Procedures, at this stage the auditor team carries out audit procedures in accordance with the predetermined plan, including internal control testing, data analysis, and other audit procedures.

Continuous Communication, where ongoing communication with the audit firm is maintained to obtain additional information, explain audit findings, and build a collaborative relationship.

4. Reporting

Compilation of Audit Report, at this stage that a comprehensive audit report is prepared, clearly summarizing the audit findings, audit recommendations, and audit conclusions.

Discussion and Agreement, where the audit report is discussed with the auditor to obtain feedback, reach agreement on findings and recommendations, and resolve potential disagreements.

Final Report Submission, where the final audit report is submitted to the audit management for follow-up and implementation.

5. Monitoring

Follow-up of Findings and Recommendations, where the auditor will monitor the corrective actions taken by the auditor in following up on audit findings and recommendations.

Follow-up Audit, is a follow-up audit conducted to verify the implementation of corrective actions and ensure their effectiveness.

Continuous Improvement, is the last stage of the agile process where audits are periodically evaluated to identify opportunities for improvement and increased effectiveness in the future.

How the Agile Audit Method Works

The agile audit method works by dividing the audit process into short cycles called sprints. Each sprint has a goal, a timeframe, and measurable results.

At the start of the sprint, the auditor team will collaborate with the auditors to define the sprint objectives, plan sprint activities, and set priorities. The auditor team will then carry out sprint activities, such as internal control testing, data analysis, and interviews with the auditors.

At the end of the sprint, the audit team will meet with the auditors to review the sprint results, get feedback, and discuss next steps. The sprint results are then documented and used to update the audit plan.

This process is repeated for several sprints until all audit objectives are achieved.

Agile audit methods offer several advantages over traditional audit methods, such as:

  • Improve audit efficiency and effectiveness
  • Improving audit quality
  • Improving auditory satisfaction
  • Eases adaptation to change

The agile audit method is the right audit approach for organizations that want to increase the efficiency and effectiveness of their audits, improve the quality of their audits, and increase their audit satisfaction.

This is the explanation of the agile audit method in the auditing process. Keep in mind that this method is a fast and thorough audit method, so the auditing process is not carried out in detail but in general, this aims to adjust the audit process to unexpected situations.

So it can be said that this method is fast and targeted in general because the time given in this audit method is limited and not as much as other audit methods. This process is useful for audits that are scanning seperti audit digital.

In digital auditing, Audithink is audit software which relies on a fast and targeted system. Audithink makes it easy for users to choose the type of method they want, such as the agile audit method, which is thorough and fast. Contact us to schedule an app demo or for more information.