2023 Audit Salary & Recruitment Trends Guide

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2023 Salary & Recruitment Trends Guide: Internal Audit, Assurance and Control

Despite uncertainty about the economy and talent shortages for 2023, employers are still hiring audit professionals at historically high levels. Audit salaries and bonus offerings continue their steady upward trajectory and contribute to a significant challenge for recruiting internal auditors. With such fierce competition, employers and professionals alike need to know what’s impacting the market and how you can navigate it to your advantage.

We review some of the latest trends shaping the audit profession and review the current market’s salary offerings.

 

Permanent recruitment trends

In 2022, the internal audit, assurance and controls recruitment market picked up where it had left off the previous year – with strong demand, high placement volumes and a steady stream of confident candidates motivated to make a change.

Companies opened up the hiring floodgates in 2021, once the uncertainty surrounding Brexit and Covid-19 lockdowns began to fade. Our consultants were inundated with roles, and much of this pent-up demand spilled over into 2022.

“A perfect storm of factors has led to a massive amount of hiring over the last two years,” says Russell Bunker, Director of Barclay Simpson’s Audit Division.

“The pandemic encouraged many people to reassess their lifestyle and consider big career changes. Meanwhile, Brexit meant fewer candidates were applying from mainland Europe, exacerbating ongoing talent shortages. Against this backdrop, firms were incentivised to move quickly and many implemented streamlined recruitment processes in order to fill key vacancies.”

A combination of these and other market factors resulted in substantial salary increases for professionals both in and out of London, as well as at all levels of seniority. As we head deeper into 2023, recruitment activity in the UK has slowed slightly due to uncertainty about the economy and candidate shortages. Companies that had previously streamlined their hiring are now increasingly reverting back to longer, more selective recruitment processes.

Despite this, starting salaries and temp wages continue to rise, albeit at a slower pace than last year, and hiring levels are still high by historic standards.

Finding and attracting high-quality candidates remains a key challenge for organisations. Our latest survey data shows a unanimous 100% of employers said sourcing skilled professionals was difficult in today’s market. Of these, 59% reported it was ‘very challenging’.

Compensation expectations were the overwhelming factor thwarting hiring, with 77% of employers citing it as a problem in 2022 – up from 64% who said the same the previous year. A lack of technical or regulatory skills (50%) and a poor cultural fit (27%) were the second and third biggest challenges, respectively.

Brexit continues to be a central issue for organisations. Nearly half (49%) of employers said the UK splitting from the EU had led to a drop in suitably qualified candidates, with 19% noting a significant reduction.

Given the opportunities available at the moment, it’s perhaps unsurprising that 94% of candidates are currently optimistic about their employment prospects. Nearly four out of 10 describe themselves as ‘very confident’ in the state of the market.

Better remuneration remains the top reason candidates sought a new role last year, with 51% of respondents listing it as their priority. This was up from 41% in 2021, likely indicating its rising importance as cost of living factors take hold.

Interestingly, there was a significant drop in the proportion of people who cited their work-life balance as the primary motivator to change jobs (12% versus 23% in 2021).

With more workplaces offering generous post-Covid flexible working options, it’s possible that some employees have already experienced significant improvements to their work-life balance, meaning other issues now take priority.

Nevertheless, work-life balance ranked higher overall than career development as a motivating factor for the first time since our surveys began. This was due to a larger proportion of candidates choosing a healthy work-life balance as their second or third most important issue when considering new roles.

 

Top three factors preventing hiring
 

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Contract recruitment trends

Nearly two years have passed since IR35 reforms were introduced in 2021. Initially, some contractors left the market, either retiring early or seeking permanent roles because interim positions were seen as less attractive.

We witnessed this trend begin to reverse in 2022, with an increasing number of professionals looking to return to the contract market once it became clear that IR35 changes were having less of an impact than anticipated.

"I'm speaking to candidates who are leaving the permanent jobs they accepted at the height of the pandemic because they're confident they can earn more money again as contractors, particularly as the cost of living crisis intensifies," says Andrew Whyte, Associate Director and Head of Interim at Barclay Simpson.

From a business perspective, none of the employers we surveyed said the reforms were significantly affecting their ability to engage skilled contractors – 70% claimed they had no impact at all.

Currently, nearly half (49%) of internal audit departments utilise contract or temporary resource and they are primarily sought for their subject matter expertise and specific project work.

However, the number of organisations that are using interim staff because they cannot find permanent employees has tripled year on year, rising from 6% in 2021 to 18% last year. This emphasises the difficulties that many employers are facing when trying to attract and retain high-quality internal auditors in today's increasingly competitive environment.
 

Top reasons to engage contract/temp internal audit professionals from 2022 and 2021
 

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Fixed-term contracts (FTCs) are currently the most common form of flexible resource arrangement. These became popular among employers during the pandemic – a time when candidate availability was good and many professionals were anxious about being out of work for long periods.

With the interim market strengthening, however, fewer candidates are willing to consider FTCs, arguing that they offer neither the job security of a permanent role nor the financial incentives of a traditional contracting position.

 

Top 3 ways employers hired contract/temp auditors
 

 

Key factors affecting audit recruitment

Every year, the Chartered Institute of Internal Auditors (IIA) publishes its Risks in Focus report, highlighting the hot topics for the profession over the coming 12 months.

Of the issues raised in its 2023 edition, the three that are affecting recruitment decision-making the most are:

  • Climate change and environmental sustainability
  • Cybersecurity
  • Macroeconomic and geopolitical risk

From a sustainability perspective, our consultants are reporting a notable increase in the number of candidates in financial services (FS) who want to take the CFA Institute's Certificate in ESG Investing or a similar qualification. Demand for ESG audit specialists is relatively low at the moment, but this is likely to change as the focus on the environment and climate change continues to intensify.

Cybersecurity was the IIA's top risk for 2023, a spot it has held for five consecutive years. Cyber skills remain highly sought after, with employers particularly on alert after the UK's National Cyber Security Centre urged organisations to bolster their defences following Russia's invasion of Ukraine last year.

Along with the pandemic, the Russia-Ukraine conflict has been a major factor in global supply chain issues, leading many commerce firms to reassess their exposure to these risks and seek auditors with appropriate skills and experience in this area.

 

Bridging the data analytics gap

Many organisations have sought to improve their data analytics strategy over the last five years, but there is a large gap between the capabilities of firms at the cutting edge of the industry and those that are still beginning their analytics journey.

Approximately a third of organisations still aren’t using any form of data analytics at all, while only 7% have implemented advanced AI. However, the gap is closing and demand for auditors with data analytics skills is high and rising.

There are still relatively few people who have these skillsets, which is why we are seeing organisations offer a premium for candidates that can combine robust technical expertise with strong business acumen.

 

Inclusion and diversity

Every organisation is on a journey to make their workplaces fairer and more inclusive. According to our research and conversations with our community members, internal audit departments continue to make good progress.

In 2021, 73% of employers of audit professionals agreed they had an inclusive and diverse company culture. This figure rose to 88% in 2022, and the proportion of respondents who 'strongly agreed' was especially encouraging, rising from 30% to 53% year on year.

Employers routinely ask for diverse candidate shortlists, and some businesses are even adopting a more US-based approach to interviews where they do not request a candidate's current salary. This avoids further entrenching salary gaps for women and disadvantaged groups who may already be earning a lower base.

There is always room for improvement, however, and we believe internal audit is in a unique position to not only assess how businesses are performing on inclusion and diversity, but also advise on ways to address shortfalls in policy.

 

Post-pandemic attitudes to flexible working

Demand for flexible working has been rising steadily over the last decade, and the Covid-19 pandemic has certainly accelerated this trend.

Just 3% of internal auditors now want to be fully office based, with the remainder favouring a hybrid working set-up. Three days at home is the sweet spot for most (35%) people, although nearly a fifth (19%) would prefer to be fully remote.

Audit-Graph
 

Have organisations adapted?

For the most part, yes.

Our data shows 93% of employers utilise hybrid or remote working arrangements, and 89% expect their current flexible working policies to remain in place for the foreseeable future.

Most hybrid working models echo candidate preferences, with the majority (67%) allowing staff to work from home two or three days a week. However, the level of flexibility offered typically depends on the type of work being performed, as well as the industry and its culture.

For example, some US and Middle Eastern FS firms are keen to have their London-based employees on-site five days a week. Internal controls roles, however, are more likely to require only one day a week or less in the office.

In today's competitive environment, flexible working is clearly becoming a key battleground in the war for talent. Organisations that are seen as inflexible may struggle to source high-quality candidates at a time of widespread talent shortages.

This is already the case for some, with more than a quarter (26%) of employers admitting their current policies are causing recruitment and retention problems.

"Everyone expects flexible working now. In some sectors that we recruit for, having to go into the office more than one or two days a week is considered quite rigid. Roles that require candidates to be in the office every day are often extremely difficult to fill." - Adam Hair, Senior Consultant at Barclay Simpson

 

Salary and bonus trends

Due to fierce competition within internal audit recruitment, starting salaries have risen considerably over the last two years. These increases are occurring throughout the UK and across all levels of seniority across the profession.

It is not uncommon for candidates to secure a new starting salary that is 20% higher than what they are currently earning. In exceptional circumstances, offers may extend to 25% above a candidate’s previous salary.

Conversely, employers only expect to increase base salaries for their existing staff by an average of 6% over the next 12 months.

This disparity, combined with growing uncertainty about the economy, is causing many professionals to consider switching jobs. Even people who are happy in their current role are being tempted into the market because of the potential to earn far more elsewhere.

Given the current climate, organisations recognise how crucial it is to hold on to their best staff, which has resulted in a notable rise in generous counteroffers.

However, for regional FS companies, it's difficult to compete with London-based firms that can offer candidates both higher salaries and, increasingly, the opportunity to work largely from home.

"The local talent pools is dwindling for FS businesses in locations such as Manchester, Birmingham, Edinburgh and elsewhere. Candidates are seeing roles that only require one or two days a week in London that pay 10-15% more than they can earn locally. Some companies can bump up starting salaries to compete, but that's not always feasible." - Steven Driver, Principal Consultant at Barclay Simpson

Another way employers are attempting to retain staff is by offering cost of living bonuses, either in the form of permanent base salary increases or as a one-off contribution.

These payments are occasionally tiered or on a sliding scale, with junior staff given larger contributions because they are more likely to be affected by the economic downturn.

 

Audit Salaries

These salary guide tables provide indicative base salary ranges for positions in specialist areas across locations which provide enough data to give meaningful figures. They are not comprehensive.

 

Public Practice (Big Four, Top 10)

Area Internal Auditor
1 - 3 yrs 

Senior Auditor
3+ yrs

Audit Manager
7+ yrs
Senior Manager
10+ yrs
Director
15+ yrs
London £28,000 - £50,000 £50,000 - £65,000 £55,000 - £75,000 £75,000 - £130,000 £95,000 - £200,000+
South East £25,000 - £45,000 £42,000 - £60,000 £52,000 - £70,000 £65,000 - £110,000 £80,000 - £140,000+
Regional £23,000 - £30,000 £40,000 - £50,000 £50,000 - £65,000 £65,000 - £90,000 £80,000 - £120,000+

 

Not for Profit

Area Internal Auditor
1 - 3 yrs 

Senior Auditor
3+ yrs

Audit Manager
7+ yrs
Senior Manager
10+ yrs
Director
15+ yrs
London £30,000 - £45,000 £48,000 - £60,000 £55,000 - £70,000 £60,000 - £90,000 £85,000 - £120,000+
South East £30,000 - £45,000 £45,000 - £60,000 £50,000 - £60,000 £55,000 - £80,000 £75,000 - £110,000+
Regional £25,000 - £40,000 £40,000 - £50,000 £45,000 - £60,000 £50,000 - £80,000 £75,000 - £90,000+

 

Corporate & Investment Banking

Area Internal Auditor
1 - 3 yrs 

Senior Auditor
3+ yrs

Audit Manager
7+ yrs
Senior Manager
10+ yrs
Director
15+ yrs
London £40,000 - £60,000 £60,000 - £80,000 £75,000 - £100,000 £85,000 - £130,000 £120,000 - £250,000+

 

Consumer and Private Banking

Area Internal Auditor
1 - 3 yrs 

Senior Auditor
3+ yrs

Audit Manager
7+ yrs
Senior Manager
10+ yrs
Director
15+ yrs
London £30,000 - £60,000 £60,000 - £80,000 £75,000 - £100,000 £80,000 - £125,000 £110,000 - £250,000+
South East £30,000 - £45,000 £48,000 - £65,000 £60,000 - £80,000 £75,000 - £110,000 £90,000 - £170,000+
Regional £28,000 - £45,000 £42,000 - £65,000 £52,000 - £72,000 £70,000 - £100,000 £90,000 - £150,000+

 

Asset and Wealth Management

Area Internal Auditor
1 - 3 yrs 

Senior Auditor
3+ yrs

Audit Manager
7+ yrs
Senior Manager
10+ yrs
Director
15+ yrs
London £30,000 - £60,000 £60,000 - £80,000 £75,000 - £100,000 £80,000 - £125,000 £110,000 - £250,000+
South East £30,000 - £45,000 £48,000 - £65,000 £60,000 - £80,000 £75,000 - £110,000 £90,000 - £170,000+
Regional £28,000 - £45,000 £42,000 - £65,000 £52,000 - £72,000 £70,000 - £100,000 £90,000 - £150,000+

 

Insurance

Area Internal Auditor
1 - 3 yrs 

Senior Auditor
3+ yrs

Audit Manager
7+ yrs
Senior Manager
10+ yrs
Director
15+ yrs
London £30,000 - £60,000 £60,000 - £80,000 £75,000 - £100,000 £80,000 - £125,000 £110,000 - £250,000+
South East £30,000 - £45,000 £48,000 - £65,000 £60,000 - £80,000 £75,000 - £110,000 £90,000 - £170,000+
Regional £28,000 - £45,000 £42,000 - £65,000 £52,000 - £72,000 £70,000 - £100,000 £90,000 - £150,000+

 

Commerce and Industry

Area Internal Auditor
1 - 3 yrs 

Senior Auditor
3+ yrs

Audit Manager
7+ yrs
Senior Manager
10+ yrs
Director
15+ yrs
London £35,000 - £55,000 £55,000 - £70,000 £65,000 - £90,000 £85,000 - £120,000 £110,000 - £250,000+
South East £32,000 - £50,000 £50,000 - £60,000 £55,000 - £75,000 £75,000 - £110,000 £90,000 - £170,000+
Regional £26,000 - £45,000 £45,000 - £65,000 £55,000 - £80,000 £70,000 - £100,000 £90,000 - £150,000+

 

Temporary/Interim rates (per day)

Area Internal Auditor
1 - 3 yrs 

Senior Auditor
3+ yrs

Audit Manager
7+ yrs
Senior Manager
10+ yrs
Director
15+ yrs
London £200 - £400 £300 - £500 £350 - £650 £500 - £800 £750 - £2,000
South East £200 - £400 £300 - £500 £350 - £650 £500 - £800 £750 - £2,000
Regional £150 - £300 £250 - £450 £350 - £600 £450 - £700 £700 - £1,500

 

 

Based on research published by Barclay Simpson, an international company in internal audit and corporate governance recruitment.

 

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