These are pivotal times for organisational survival. It is a time for internal audit to be seen, to be heard and to act.

Audit leaders have an important role in supporting the board and senior management as they make critical strategic decisions: providing insight, foresight and assurance.

Take a moment to understand how organisations have weathered the storms of recession and what internal audit can do here and now.

Stark predictions

Organisations that survive the turmoil of the COVID-19 crisis may potentially face another devastating and potentially longer-term crisis. On May 13, chancellor Rishi Sunak warned that the country is heading into a “significant recession” as GDP shrank by 2% in Q1 2020 due to the economic impact of COVID-19. The Bank of England estimates that the decline in Q2 could be as high 25%.

Even before the word pandemic became part of our everyday conversation, economists had been debating when the next recession would begin with some suggesting 2020 - 2021. They cited warning signs such as increasing debt, reducing government yields, geopolitical uncertainty, GDP growth in China lower than pre-2010 and negative returns on Standard and Poor’s 500. COVID-19 has exacerbated this exponentially.

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Unlike previous recessions, which guide our lessons learnt, the coronavirus pandemic has simultaneously affected all sectors and all countries across the globe. For many the future will be a new normal rather than a return to the recent past. The Bank of England predicts a V-shaped economic recovery albeit over a delayed period of a year, however, as with any forecast other economists have a more sceptical view – the deciding factor could be avoiding a second COVID-19 spike with a return to lockdown measures.

Differentiators of success

The risk of a recession was on the radar of…