A new code sets back the status and practice of internal auditing

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A new code sets back the status and practice of internal auditing

The Chartered Institute of Internal Auditors (the UK affiliate of the global Institute of Internal Auditors) is usually a thought leader, promoting and explaining best and leading internal auditing practices. For example, they have done excellent work on [enterprise] risk-based auditing.

But their latest publication, Internal Audit Code of Practice: Guidance on effective internal audit in the private and third sectors steps backwards from the progress made by the IIA in its Definition and Core Principles.

Here are my more significant criticisms:

  1. The first and most important failure (and I mean just that) is when they define the Role and Mandate on internal audit:

“The primary role of internal audit should be to help the board and executive management to protect the assets, reputation and sustainability of the organization.”

The IIA’s Definition of Internal Audit is right when it says that internal audit should help the organization achieve its objectives.

Internal audit should help an organization both create and protect value.

Talking about protection and not the creation of value is a severe limitation of internal audit effectiveness. It…

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