2011 IIA Pittsburgh Grant Thornton LLP Presentation (Nov 2011)

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Emerging Technology Challenges and Solutions for Internal Audit and

Compliance

Danny Miller, CISA, CGEIT, CRISC, ITIL, QSAPrincipal

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Topics

• Current Technology Landscape• Emerging Technology

– Cloud computing– Mobile computing– Cybersecurity

• Potential IA Complexities• Solutions• What’s Next?

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Current Technology Landscape

• On-premise hardware, software, and management

• Support may be on-shore, near-shore or off-shore

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Current Technology Landscape (continued)

• Localized processes and controls• Prompt remediation when required• Clear data ownership• Straightforward compliance approach

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Current Technology Landscape (continued)

• Challenges/benefits– It's expensive and requires a lot of overhead– Difficult to scale and react quickly– Significant embedded cost structure– Inflexible to meet business need– Easier to maintain audit trail

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Emerging Technology Trends

Spending on public IT cloud services will grow at more than five times the rate of the IT industry in 2011-2012

Enterprise IT planners begin to include cloud-computing expertise in some of their job searches to be prepared for the projects of the short-term and mid-term future

Hosted private clouds will outnumber internal clouds 3:1…But service providers have been incrementally ready.

Cloud management and monitoring will fuel enterprise cloud adoption

32% of CIOs expect virtualization to be their top investment in 2011

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Emerging Technology

• Cloud computing– Saas, PaaS, IaaS, DaaS

• Mobile computing– Mobile platforms that are blurring the line between a

hand-held and complex computing

• Data analytics– Master Data Management

• Cybersecurity– Trends

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Emerging Technology Platforms (continued)

Types of Clouds• Public

- Shared computer resources provided by an off-site third-party provider

• Private- Dedicated computer resources

provided by an off-site third-party or use of Cloud technologies on a private internal network

• Hybrid- Consisting of multiple public

and private Clouds

Models of Cloud:• Software as a Service (SaaS)

- Software applications delivered over the Internet

• Platform as a Service (PaaS)- Full or partial operating

system/development environment delivered over the Internet

• Infrastructure as a Service (IaaS)- Computer infrastructure delivered

over the Internet• Desktop as a Service (DaaS)

- Virtualization of desktop systems serving thin clients, delivered over the Internet or a private Cloud

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Emerging Technology Platforms (continued)

Public Cloud Private Cloud

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Emerging Technology Platforms (continued)

Cloud computing – Hybrid cloud

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Emerging Technology Platforms (continued)

Mobile computing

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Emerging Technology Platforms (continued)

• Mobile computing is:– Wireless– Utilizes tablet platforms and smartphones– Internet-based– Communication via 4G and WiFi– Scaled applications

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Potential New IA Complexity

• Cloud computing– Availability & performance– Business continuity– Cybersecurity– Data encryption– Privacy (especially in Healthcare & Life Sciences)

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Potential New IA Complexity (continued)

Cloud computing (continued)– Compliance

• FISMA• HIPAA• SOX• PCI DSS (card payments)• EU Data Protection Directive, et al.

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Potential New IA Complexity (continued)

Mobile computing– Security (physical and virtual)– Data ownership– Service interruption and recovery– Data archiving– Availability

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Potential New IA Complexity (continued)

Mobile computing– WiFi/4G security– Surveillance and access control– Availability– Data ownership and recovery– Auditability– Bluetooth “hijacking”– AIDC

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Solutions

Cloud computing– Demand good security in the contract with provider– Have a "return of data" plan at end of contract– Know where the data is and who has access– Deploy a layered security architecture– Assess and inventory risks– Conduct annual security policy audits– Deploy and authenticate user credentials– Encrypt all stored data (P2P encryption)– Actively manage passwords and segregation of duties– Implement layered firewalls

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Solutions (continued)

Mobile computing– Encrypt all WiFi access– Clarify data ownership– Implement service interruption plan– Disable Bluetooth communications– Deploy device specific security software– Encrypt all communications

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

What’s Next?• Distributed computing (the Cloud)• Cybersecurity & Privacy focus• Virtualization• Advanced IA tools

– Analytics– Provenance engines– Enhanced hardware firewalls– Advanced encryption technology– New data segregation and security standards– Secure digital communications

• Standards such as ITIL, COBIT and PCI are integrating and are now complimentary

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

What’s Next? (PCI Data Security Standards v2.0)

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

What’s Next? (PCI Data Security Standards v2.0)

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

What’s Next? (PCI Data Security Standards v2.0)

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

What’s Next? (Enterprise Master Data Management)

• Companies are awash in data, but which data is the right data to use? Data grows by 50%+ each year.

• Company leadership needs "one version of the truth" on dashboards, reports and in analytical datasets.

• Internal Audit and Compliance departments should be concerned about controls, availability, integrity and quality of data.

• Conceptually: Data and information are valuable corporate assets

and should be treated as such Data must be managed carefully and should have

quality, integrity, security and availability addressed.

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

What’s Next? (Enterprise Master Data Management)

MDM is the management of an institution’s fundamental data that is shared across multiple business units, everything from project budgets to donor contacts to employee contact information. You can think of master data as all of the enterprise data (people, places, things and activities) that the institution needs to conduct its business.

The goal of MDM, consequently, is to ensure the accuracy, consistency and availability of this data to the various business users.

We believe that all organizations would benefit greatly from creating a strategy for MDM and implementing an MDM program in light of its current state and an organization's future data and information needs.

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

What’s Next? (Enterprise Master Data Management)

Data and Information Management

Data Governance Data Architecture Management

Data Development Data Operations Management

Data Security Management Data Quality Management

Reference and Master Data Management

Data Warehouse /Business Intelligence Management

Document and Content Management Metadata Management

Table 1: Scope of Data Management

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

What’s Next? (Data Governance Activities)

• Establish institutional data standards• Identify and resolve data disputes• Implement necessary changes to data standards and

policies• Communicate actions to the organization as appropriate• Ensure accountability of institutional data policies and

standards• Escalate issues to Governance Team as necessary

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Questions?

2011 Central Regional ConferenceNovember 6-9, 2011 / Pittsburgh, PA, USA

Emerging Technology Challenges for Internal Audit and Compliance

Danny Miller, CISA, CGEIT, CRISC, ITIL, QSANational Solutions Lead – Cybersecurity

Regional Solutions Lead – Business ConsultingPrincipal, Grant Thornton LLP

Danny.Miller@us.gt.comhttp://grantthornton.com/