Data-driven audit management at Sime Darby
“It has been being able to face the audit committee and to face the management with the confidence that our term of giving reasonable assurance over transactional data—regarding integrity, regarding completeness, regarding adequate control criteria—can be relied on.”
John Edward Arkosi, OBE,
Group Head, Compliance & Corporate Assurance,
“ACL was initially called in for the audit, however we actually managed to sell it for finance, for management for IT, as well as for audit. So there’s so many things that analytics or ACL can do. Like what we have always been preaching: the limitation is basically your imagination.”
Surendran Nair Sankaran,
Head of Group Corporate Assurance Digital Forensic & Analytics,
Sime Darby is a Malaysia-based diversified multinational with operations in 25 countries & four territories and a total workforce of more than 120,000 employees. The group is involved in five core sectors, namely Plantation, Industrial Equipment, Motors, Property and Logistics.
Direct data access
ability to tap data across multiple databases
with 100% data coverage
Less field days
reduced audit days in field by ~50%
more confidence in data-driven decisions
Interview with John Edward Arkosi, OBE, Group Head, Compliance & Corporate Insurance and Surendran Nair Sankaran, Head of Group Corporate Assurance Digital Forensic & Analytic, Sime Darby.
John: I assumed the role of head of audit in 2008, around about the time that Sime Darby went through a mega-merger of three very large plantation groups within Malaysia—which then created the world’s first largest publicly listed plantation upstream player in the world.
What challenges do you face as an audit function in such a complex organization?
John: The challenges to audit—and to all assurance providers—is how do you get reasonable line of sight and be able to provide reasonable assurance across a conglomerate spanning 26 countries with multiple IT platforms, some of which are mature, some of which are immature and some of which are going through significant process changes?
Why implement audit technology?
John: When you bring in more audit resources, you just assign more work. So we had to look towards technology’s emerging audit practices. And primarily data analytics became a key focal area, because as we moved more of our businesses into a digital world, the amount of data that was just accumulating on the many, many platforms in so many countries, you couldn’t audit in a traditional sense anymore—it just became nonsensical. Driving audit towards a risk-based, data analytic approach was the only option.
What stood out about ACL as a technology provider?
Suren: We wanted to grow with a technology provider who can tell us, “hey guys, there’s something new that’s happening; do you want to follow through the journey?” Better than sticking to a technology which has been kind of obsolete. And the other major reason why we wanted to move on with ACL is because we can just tap the data directly from the databases.
How would you describe the value added to your team in using a data-driven audit management system?
John: It has been being able to face the audit committee and to face management with the confidence that our term of giving reasonable assurance over transactional data—regarding integrity, regarding completeness, regarding adequate control criteria—can be relied on. Today we can do that. And for some of our business units, where we traditionally have to audit due to Central Bank requirements, etc., there are some businesses we audit every three months. We’ve brought our number of man-days in the field from 20 to 30 down to five to seven, just purely using ACL and data analytics, and having 100% coverage. And what we’ve moved those business units to is continuous monitoring.
What advice would you give other audit leaders deciding whether to invest in data analytics for their team?
John: It’s been a continuous journey of trying to bring a transformational mindset to audit so that we don’t live with complacency—we are always saying, what can we do better?
Suren: ACL was initially called in for audit, however we actually managed to sell it for finance, for management, for IT, as well as for audit. So there’s so many things that analytics or ACL can do. Like what we have always been preaching: the limitation is basically your imagination.