Question

Analyze the steps audit committe can take to facilitate proper oversight and direction of internal auditors?

subject: Internal Auditing

please answer in detail.

Answer 1

Following are the areas in which an Audit committee can facilitate proper oversight and direction of internal auditors:

Technology application - New tools & techniques like data mining are enhancing audit’s effectiveness & efficiency and the committee can give direction & check how internal team is applying this.

Strengthen relationship between internal audit and committee – Having regular interactions between the two will ensure proper accountability and knowledge sharing

Risk plan - Flexible internal risk plan which is reactive to change.

Set strategic vision and plan - Auditors should plan effectively & efficiently to their audit plans and the same should be shared with the committee on timely basis for their guidance

Ensure compliance with The International Standards for the Professional Practice of Internal Auditing - Audit committee should ensure compliance of internal auditors with the global standards of the Institute of Internal Auditors (IIA)

Assessing talent in internal audit team for the organization – Internal Audit team is a source of functional expertise for the organization because of their greater understanding of the function’s processes and hence could be a good resource to deploy in the functions

Define value addition of internal audit – Audit committee can define value addition of internal audit to the internal and external stakeholders and ensure proper support from the management in terms of resources like manpower, tools, their time and guidance etc.

Capability building - Capability building of internal audit team through regular training programs and go-and-see visits to other organizations, seminars and other forums.