2026, Vol. 7, Issue 2, Part A

The integration of Artificial Intelligence (AI) in the hospitality industry particularly in high-volume functions such as Revenue Management, Procurement, and Guest Services, is altering the old internal control environment. This study examines the key evolution of the Internal Audit (IA) function, arguing for a move from Transactional Assurance (periodic verification of specific controls and samples) to AI Governance and Continuous Monitoring (CM/CA). Based on professional experience and industry reports, the study identifies which routine audit tasks are most vulnerable to automation, examines the core risks of AI deployment (such as algorithmic bias and lack of explain ability in dynamic pricing models), and proposes a strategic re-skilling framework for hospitality auditors.

This study examines the up-gradation of the Internal Audit (IA) function, arguing for a move from Transactional Assurance to AI Governance, the research paper is based on industry reports and research papers.