Question

Despite the adoption of International Standards   for   the   Professional   Practice of Internal Auditing on how audits should be carried out many corporates have continued to face scandals one after the other. Discuss the reasons that have led to this and suggest what should be done to correct the situation.

Answer 1

Internal auditing is conducted in diverse legal and cultural environments; for organizations that vary in purpose, size, complexity, and structure; and by persons within or outside the organization. While differences may affect the practice of internal auditing in each environment, conformance with The IIA’s International Standards for the Professional Practice of Internal Auditing

(Standards) is essential in meeting the responsibilities of internal auditors and the internal audit activity.

The purpose of the Standards is to:

1. Guide adherence with the mandatory elements of the International Professional Practices Framework.

2. Provide a framework for performing and promoting a broad range of value-added internal auditing services.

3. Establish the basis for the evaluation of internal audit performance.

4. Foster improved organizational processes and operations.

The Standards are a set of principles-based, mandatory requirements consisting of:

 Statements of core requirements for the professional practice of internal auditing and for evaluating the effectiveness of performance that are internationally applicable at organizational and individual levels.

 Interpretations clarifying terms or concepts within the Standards. The Standards, together with the Code of Ethics, encompass all mandatory elements of the International Professional Practices Framework; therefore, conformance with the Code of Ethics and the Standards demonstrates conformance with all mandatory elements of the International Professional Practices Framework.