The Institute of Internal Auditors Nigeria (IIA Nigeria) has warned that cybercrime, financial fraud and the misuse of artificial intelligence (AI) are exposing Nigerian organisations to growing risks, including financial losses, data breaches and compromised business decisions.
The institute’s Chief Executive Officer, Don Umeha, issued the warning at its 2026 conference in Lagos, themed “Future-Proofing Assurance in Nigeria: Confronting Cybersecurity Threats, AI Complexity and Global Volatility”.
Umeha and other internal audit professionals called for stronger internal controls, improved risk management and earlier detection of vulnerabilities as organisations increasingly rely on digital technologies to conduct their operations.
He said the shift from manual processes to technology-driven systems has improved productivity, accuracy, and operational speed, but has also created new security challenges, including weak passwords, intercepted transactions, manipulated records, and other system vulnerabilities.
According to him, weaknesses in a single digital system could trigger financial losses and disrupt wider organisational operations, so institutions must identify and address security gaps before attackers exploit them.
Umeha said the rapid adoption of AI was adding another layer of complexity to the risk environment, particularly where organisations deployed the technology without adequate safeguards, oversight and clear policies governing its use.
He urged organisations to move beyond responding to losses after they occur and establish stronger mechanisms to prevent security breaches, detect irregularities, and contain emerging threats.
The IIA Nigeria chief executive stressed that organisations should not reject technological advancement because of its risks, but should ensure that the benefits of digital transformation are matched by effective security and accountability measures.
He also called for a shift in internal auditing, arguing that the profession should move beyond examining completed transactions and documenting past failures to identifying weaknesses before they cause damage.
According to Umeha, internal auditors should scrutinise organisational policies, transaction patterns and operational processes to identify vulnerabilities and recommend preventive measures. He warned that auditors who relied exclusively on manual procedures risked becoming less effective as AI-driven systems increasingly shaped business operations.
He also called for appropriate AI regulation, including clear rules and penalties to discourage its use for fraud and other unethical activities. He urged young people to use the technology for productive, innovative purposes rather than for activities that could cause financial or social harm.
The institute’s Board Chair, Ibukun Beecroft, said the changing risk environment required internal auditors to take on a more strategic role in helping organisations anticipate threats and make informed decisions.
Beecroft, also a partner at Deloitte and head of its West Africa Audit and Assurance business, identified AI, cybersecurity, environmental, social and governance concerns, digital transformation and global volatility as areas that require greater professional preparedness.
She said internal auditors should evolve from retrospective reviewers into trusted advisers who help management teams and boards understand risks before major decisions are taken.
Beecroft also emphasised the importance of coordinated assurance involving operational managers, risk professionals and internal auditors to provide a more comprehensive assessment of organisational risks.
While acknowledging that AI could improve efficiency and let auditors focus more on strategic responsibilities, she cautioned that the technology should not replace professional judgement.
She noted that AI systems can generate inaccurate information, so professionals must understand how the technology works and verify its outputs before relying on them.
Beecroft also called for clear organisational policies on AI use, particularly regarding data protection and the handling of confidential information. She encouraged professionals to acquire the skills needed to use emerging technologies effectively rather than view AI solely as a threat to employment.
Harriet Akua Karikari, West African Vice Chair of the African Federation of Institutes of Internal Auditors, urged practitioners to align their audit priorities with emerging risks affecting organisations across Africa and globally.
Karikari identified cybersecurity, digital transformation and global volatility as significant risks highlighted in the federation’s Risk in Focus report. She encouraged internal auditors to use the findings when preparing their 2027 annual audit plans.
She said auditors could strengthen their role as trusted advisers by helping organisations address vulnerabilities, improve operations and achieve their objectives.
Karikari also warned about the growing volume of AI-generated reports, images and other digital material, stressing that auditors must critically examine such content before accepting it as evidence.
She said the credibility of audit conclusions depends on the quality and reliability of the evidence supporting them, adding that professionals must verify information rather than accept it simply because it appears authoritative or was generated digitally.
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She warned that failing to scrutinise inaccurate or fabricated material could undermine audit findings and contribute to flawed organisational decisions.
The audit leaders’ concerns highlight the need for Nigerian organisations to strengthen their capacity to manage digital risks as they adopt new technologies.
For businesses and public institutions, the challenge goes beyond investing in digital systems; it requires appropriate controls, professional skills, and accountability mechanisms to protect funds, confidential information, and institutional integrity.
The speakers called for a more proactive approach to internal auditing, with greater emphasis on early risk detection, responsible AI adoption and evidence-based decision-making.
