Category: Cyber Security

Although most would agree that internal audit is an assurance function, I like to think of internal auditors as value-added trusted advisors. A given mandate will provide assurance on processes that are functioning appropriately; however, the real value is in identifying areas of improvement that add tangible value back to the organisation. Data analytics has long been my tool of choice to help accomplish this value in an effective and efficient manner.

At ISACA’s 2015 North America Computer Audit, Control and Security (CACS) conference, I will be presenting alongside Bob Cuthbertson, COO of CaseWare IDEA Inc., on successful integration of data analytics within a risk-based IT audit universe. In a prelude to our session, I would like to provide examples from my own work in the past that I will be adding to, along with others, during the session on 16 March in Orlando, Florida.

Getting Started—Scoping the Audit Engagement

Understanding the business is the first and most crucial step in the audit process. It is what determines the amount of value you can potentially provide to key stakeholders. Shown in scenario 1 below, data analytics can be used before the audit begins as a status indicator of the risks facing an organization. And with this information, internal audit is able to improve the audit effectiveness as well, with the ultimate effort of providing value to the organisation.

Scenario 1: Driving the Audit Scope

Areas of Risk Identified:

• Change Management
• Project Management

Challenge:  Time limitations allowed only one area of focus for the audit year.
Solution:  High-level analytics of change logs and project management databases uncovered significant internal development projects.
Results:  The System Development Life Cycle (SDLC) process was therefore identified as an area of immediate value to the organization.

Homing in on Insights Gained (Audit Execution)

To save time and resources, the use of data analytics in the planning phase helps develop greater understanding of where the hotspots are in terms of risk. Outlined in scenario 2 below, utilizing 100 percent of the available data enables internal audit to truly focus and identify anomalies within areas that have been identified as high risk.

Scenario 2: Testing Compliance

Mandate:  Operational efficiency—IT help desk tickets

Challenge:  More than 140,000 tickets were opened and closed during the year.

Solution:  Use data analytics to identify trends to ensure the IT department meets the service level requirements—as delineated in the service level agreement (SLA).

Steps:

1. Obtain an extract from the ticket management system (Footprints). Confirm data completeness by verifying record count on screen (from the system) to the csv dump.
2. Execute a trend analysis based on tickets closed by employee, criticality and category type, amount of time from “Ticket Open date” to “Ticket Close date.”
3. Confirm compliance to SLA.

Results:  The analytics showed that the IT group was in compliance with the agreed-upon SLA. Encouragingly, management was very interested in our data analysis, which led to the development of a dashboard for both operational efficiency (which was performed manually at the time by the director) and employee performance. The employee performance KPIs were then linked to their respective annual evaluations for a more objective evaluation of the core performance of the help desk employee.

Reporting Results

The insights found during the audit execution are what allow you to create a report that will provide value to the organization. They are the first step to providing a tangible root cause analysis and shedding light on the compliance and governance failures that matter most to companies.

The reporting phase is crucial when it comes to providing the added value for which we strive. If you have performed your audit effectively, the report will only include validated control deficiencies. The use of data analytics throughout the audit process should allow time to report on exact findings, highlight root causes and provide tangible recommendations. Furthermore, data analytics, namely data visualisation, can be used to convey high amounts of data and information in one image. I always remind myself that information is what the other party receives and not what I say. Therefore, the use of data visualisation to ensure the identified efficiencies make it across to the reader is yet another way in which data analytics helps me become the value-added trusted advisor I strive to be.

Conclusion

We have been using data analytics and attaining value by operating in a systematic and structured manner. We maximize our investment through these efficiencies and are able to provide stakeholders with the answers to questions before they even have them. This can and will continue to increase our value as internal auditors and trusted advisors to the business. During the session at North America CACS in March, I will be expanding on the processes behind these scenarios along with more examples using analytics tactics and visualisation methods. I hope to see you there!

Seren Dagdeviren, CPA, CIA
Manager, Internal Audit, Ivanhoé Cambridge
Montreal, QC, Canada

Seren Dagdeviren will present “Building Momentum” at 2015 North America CACS in Orlando, Florida, USA, 16-18 March 2015. For information and to register, visit www.isaca.org/northamericacacs2015.

[ISACA]

Our industry has been discussing the need for updates to critical public electronic communications laws and policies; reductions in corporate liability for intelligence sharing; national data breach legislation to replace the morass of US state laws; and increases in funding for cybersecurity education, research and standards for many years.

There are two milestones that make a transition from conversation and confusion to clear and decisive action so important now. The first is that we’ve reached critical mass in both corporate and consumer understanding and perception of the importance of cybersecurity. While mega breaches are not new, consumers’ inconvenience of swapping credit card numbers has largely been the extent of impact for most Americans in the past and attention has quickly waned. This year, consumers and corporate citizens at all levels experienced multiple breaches that created a saga of compounding and widespread impact—from credit cards, to corporate espionage, to threats of physical terrorism—and sustained attention for months.

The second, more troubling factor is escalation. While some of the nation state saber- rattling may be just that, the ease with which cybercriminals compromised a significant footprint of the retail and digital advertising sector—and the aggressive and calculated manner in which they compromised and then meted out damage on Sony and other very mature organizations—is a major milestone and also an unsettling indicator of things to come.

It is critical that we begin to disrupt the cyber adversaries and their economic and political incentives. This disruption requires a concerted effort , and the government either can play a modern and effective leadership role or be a passive bystander commenting on the state of affairs. In the State of the Union speech President Barack Obama will provide a clear indicator of which direction the US government is heading on this issue.

ISACA is seeking to address cybersecurity challenges, including the global skills gap and need for guidance, in 2015 and beyond. With the critical skills gap in cybersecurity and the need for greater industry engagement and peer conversations around security governance, cyber career progression, standards, training curricula and professional certification, ISACA’s Cybersecurity Nexus(CSX) plays a pivotal role in bringing practitioners together worldwide and creating a launchpad for cybersecurity experts and solutions of the future.

Eddie Schwartz, CISA, CISM, president of WhiteOps and chair of ISACA’s Cybersecurity Task Force

[ISACA]

2014 has been called the year of the breach, with organizations from Home Depot to Sony experiencing attacks.

Information technology failures are serious—to the point that companies can lose customers and market share.

Now the question is: what measures should be taken to encounter severe threats? After having a lot of experience through years of working with diverse people from multinational financial institutes, I conclude that only having effective and efficient IT governance in place can fulfill the expectations of stakeholders.
Why do we need governance?
Stakeholders expect:

• Business is secure and creates value
• The organization is responsive to changing business paragons.

What do we get from governing?
The board and executives have a better understanding of IT and have a clear picture of its performance as every opportunity and mishap are totally based on decision making. This enables them to make effective decisions regarding the investment and also assures the required IT objectives. “Effective governance” leads management toward better execution of strategies to achieve a desired behavior. “Transparency in governance” develops stakeholder confidence in responsibility and accountability, provides a competitive edge to the enterprise, and is helpful in improving the customer satisfaction level.
Enterprise IT governance provides balanced operations, which means IT can respond to the business needs and at the same time maintain and improve the stability and quality of services in a cost-effective manner. Outsourced services can be directed and controlled clearly as this approach enables effective, efficient and adaptable relationships.

Effective governance (improved return on investment and value on investment) helps to minimize failures, optimize productivity, enhance efficiency, and provide a compliance with rules and regulations by eliminating redundancy, overlap and lack of clarity.

How do we implement enterprise governance of IT?
Companies based on matured IT strategic plans that enable the business tend to be the most successful, having an established and fully integrated operating environment. With these best practices they are securing their information assets in terms of their confidentiality (reveal to authorized individuals only), integrity (confidence in data and assets) and availability (accessible when required).

So, taking all these benefits into account, how do we get started in generating, transforming and sustaining IT governance? First and foremost, one thing we must keep in mind is that we cannot adopt IT governance using a one-size-fits-all approach. Each organization is distinctive, with unique needs and priorities, so it should adapt or form its own governance model based on the nature of its business. Organizations that have no IT governance at all should take a slow start (perhaps with an advisory body, external consultant with strategic planning, standards making, and project prioritization) and add more functions to the governing body as the organization matures. Those organizations that are employing some variety of IT governance may wish to widen their body further into decision-making and performance management.

Best practices for information system governance can be evaluated within the perspective of industry-wide accepted standards, such as processes like information workflow, application and infrastructure development and maintenance, and support services (both operational in-house and external). These need to be gauged and then should be benchmarked with similar industry leaders and peer organizations of a similar size and IT infrastructure. After benchmarking, performance advancement activities can be started using industry standards and/or frameworks such as ITIL. I personally prefer and recommend ISACA’s COBIT 5 as a framework for effective governance and management of enterprise IT.

COBIT 5 has integrated all industry best practices into one framework, and this single integrated framework makes the point that to achieve alignment of best practices to business requirements COBIT 5 can be used at the highest as well as lowest level. This provides a framework for overall control based on a model of IT processes that should generically suit most organizations regardless of industry and whether private or public.

Security breaches? Their proactive/reactive defensive approaches? Strategic alignment? Value delivery? Risk and resource management? Performance measurement? The only answer to all these questions is to have effective and efficient enterprise governance of IT in place.

Organizations with highly effective IT governance prioritize and communicate the structure and essential changes across the organization. Involving both IT and business leaders and bringing them together at the upper management level is vital for ensuring how closely IT is related to business performance. Effective IT governance is a journey, but success can be realized by those who understand the path and the best IT governance practices that keep them on course.

Ali Nouman, CISA
Information Security at The Bank of Punjab, Pakistan

COBIT 5 and related documents are available for free download at www.isaca.org/cobit and http://cobitonline.isaca.org.

[ISACA]