Trending Topics in Audit Reports
Background
An internal audit executive would like to provide an overview of the current trends in audit findings to the Board and senior management. Also, their professional practices group would like to give updates to the head of each of the organization’s business lines on the trends of the reported audit findings for each of their respective activities.
The Challenge
The Internal Audit group maintains a database that contains the text of the audit finding, a few fields such as the business line, date, auditor, and other general details, along with ad-hoc flags that qualify each audit finding’s severity and relationship with the organization’s control structure. This data set did not include the auditor’s discussion on the themes of the audit report (contained in the front matter of each audit report and not captured in the database) and, at the time of our engagement, the audit group did not mine the text of the audit finding.
Our Approach
To extract patterns from text data, we applied a Topic Modelling: we obtained the text of each audit finding and front-matter of reports. We modelled topics and, using the meta-data from the Audit team’s database, we were able to map the evolution of topics across time and business lines, as the client required, but we were also able to provide mappings to audit ratings, finding severity, and other meta-data elements to which we had access.
Our solution also mapped the documents in which a given topic occurred through a visual interface, which allowed the chief audit executive, her management team and other relevant stakeholders to navigate a complex data set, which contained audit reports (human-readable free text) together with its meta-data.
The Benefit
The organization produced hundreds of audit reports during the past years. It would have been impractical, or even impossible, for a person or a group of people to read, summarise, and determine the trends that occurred for topics over time, business lines, audit grades and other dimensions. We provided an automated solution that not only met our client requirements, but that was easy to maintain and reuse on an ongoing basis.
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