Role of Internal Audit
INTRODUCTION
Internal auditing is a management-oriented discipline that has evolved rapidly since World War II. Once a function primarily concerned with financial and accounting matters, internal auditing now addresses the entire range of operating activities and performs a correspondingly wide variety of assurance and consulting services. By definition, according to Institute of Internal Auditors (IIA), internal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organisation's operations. It helps an organisation accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes.
Internal auditing is executed by an internal auditor. He is regarded as part and parcel of the organisation since his/her appointment is usually effected and influenced by the organisation’s management. His/her activities are defined by the recruiting organisation, though there are basic issues that are expected to be addressed by him/her during the course of his/her tenure in office.
This paper, therefore, attempted to unveil the issues surrounding the internal auditor’s functions within an organisation. As such the paper dwells on the definition, duties, responsibilities, relationships, ethics, and independence of an internal auditor. In doing this, both the international and local requirements, where different, regarding the functions and operations of an internal auditor are considered.
DEFINITION OF INTERNAL AUDITOR
Many definitions have been forwarded for internal auditor. The following are some of them:
• The Institute of Internal Auditors (IIA) defines an internal auditor as an individual within an organisation's internal auditing department who is assigned the responsibility of performing internal auditing functions.
• Internal auditor is an accountant who reviews the accounting procedures, records,
Internal auditing is a management-oriented discipline that has evolved rapidly since World War II. Once a function primarily concerned with financial and accounting matters, internal auditing now addresses the entire range of operating activities and performs a correspondingly wide variety of assurance and consulting services. By definition, according to Institute of Internal Auditors (IIA), internal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organisation's operations. It helps an organisation accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes.
Internal auditing is executed by an internal auditor. He is regarded as part and parcel of the organisation since his/her appointment is usually effected and influenced by the organisation’s management. His/her activities are defined by the recruiting organisation, though there are basic issues that are expected to be addressed by him/her during the course of his/her tenure in office.
This paper, therefore, attempted to unveil the issues surrounding the internal auditor’s functions within an organisation. As such the paper dwells on the definition, duties, responsibilities, relationships, ethics, and independence of an internal auditor. In doing this, both the international and local requirements, where different, regarding the functions and operations of an internal auditor are considered.
DEFINITION OF INTERNAL AUDITOR
Many definitions have been forwarded for internal auditor. The following are some of them:
• The Institute of Internal Auditors (IIA) defines an internal auditor as an individual within an organisation's internal auditing department who is assigned the responsibility of performing internal auditing functions.
• Internal auditor is an accountant who reviews the accounting procedures, records,