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May is international internal audit awareness month

A look at the varied responsibilities of the Internal Auditor … all in a day’s work!

Achieving objectives

For the most part, companies are in business to make money. Schools, charities, and other non-profit organisations may have the goal of educating, influencing behaviour, or helping those less fortunate.

Regardless of what drives them, all organisations aim to achieve their specific objectives with the greatest efficiency and effectiveness possible. To do this, many organisations enlist the aid of boards of directors to provide oversight and strategic direction.

For the board to steer the organisation effectively, board members must receive timely, accurate information about the organisation’s many strategic, operational, financial, and compliance risks as well as assurance that the risks are being well managed.

Enter the internal auditors . . .

What is internal auditing?

Internal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization’s operations.

At its simplest, internal auditing involves identifying the risks that could keep an organisation from achieving its goals, making sure the organisation’s leaders know about these risks, and proactively recommending improvements to help reduce the risks.

For internal auditing to be effective, the organisation’s leaders must be open to discussing tough issues and seizing opportunities to make necessary changes for improvement.

Internal auditors’ independence and broad perspective of the organisation make them a valuable resource to executive management and the board of directors as they ensure that the organisation is held accountable to its stakeholders.

Internal auditors keep an eye on the corporate climate and perform a variety of activities such as assessing risks, analysing opportunities, suggesting improvements, promoting ethics, ensuring accuracy of records and financial statements, educating senior management and the board on critical issues, investigating fraud, detecting wasteful spending, raising red flags, recommending stronger controls, monitoring compliance with rules and regulations, and much more!

Seems like a lot to ask from one resource? Maybe for some, but for internal auditors, it’s all in a day’s work.

Who are internal auditors?

Internal auditors are explorers, analysts, problem-solvers, reporters, and trusted advisors. They bring objectivity and a variety of skills and expertise to the organisation. They come from diverse areas such as finance, operations, IT, and engineering. Today’s internal audit professionals are revered for their critical thinking and communication skills, as well as their general IT and industry-specific business knowledge.

Internal auditors are, to a great extent, key to an organisation’s success. They review the organisation’s processes, operations, and goals. They provide objective, professional advice to all levels of management and pave the path toward continuous improvement.

Competent internal auditors follow the profession’s internationally accepted code of ethics and standards for professional practice. To demonstrate their professionalism and competence, some internal audit practitioners choose to obtain professional certifications such as the globally recognised Certified Internal Auditor® or Certification in Risk Management Assurance™.

Depending on the structure, maturity, and resources of the function, internal auditors may perform some or all of the following tasks.

Offer insight and advice

There are times when internal auditors offer insight regarding strategic risks and advice consult on projects to ensure that risks are considered and controls are built into a process on the front-end (e.g., mergers and acquisitions, new technology implementation.

Evaluate risks

It’s the internal auditor’s job to assess the significance of the organisation’s many risks and the effectiveness of risk management efforts, communicate these to management and the board, and develop recommendations to improve risk management.

Assess controls

Internal auditors evaluate control efficiency and effectiveness and provide management and the board assurance that the controls in place are adequate to respond to the risks that threaten the organisation.

Ensure accuracy

Internal auditors ensure financial statement accuracy through examination of the reliability and integrity of financial and operational information.

Improve operations

With a solid understanding of the organization’s objectives, internal auditors examine operations to determine whether they are efficient and effective.

Promote ethics

Professional internal auditors agree to abide by a Code of Ethics that upholds the principles of integrity, objectivity, confidentiality, and competency. They raise red flags when they discover improper conduct.

Review processes and procedures

Internal auditors review operations closely and assess whether existing processes are well designed to help the organisation achieve its goals.

Monitor compliance

Internal auditors assess the organisation’s compliance with applicable laws, regulations, and contracts to ensure that management is addressing these requirements adequately. They also offer insight into the impact that non-compliance would have on an organisation and inform senior management and the board of non-compliance.

Assure Safeguards

Internal auditors evaluate the procedures used to safeguard assets from theft, fire, illegal activities, or other types of loss. They bring deficiencies to light and make recommendations for enhanced protection.

Investigate Fraud

Because fraud can affect any level of the organisation, it’s important that the board of directors grants the internal audit function access to all records and authority to conduct audits and investigate possible fraudulent behaviour throughout the organisation.

Communicate results

After auditing a particular area, internal auditors report their findings and recommend appropriate courses of action.

True professionals

Internal auditors are well-disciplined in their craft, and they are committed to growing and enhancing their skills through continuing professional education. To fulfil all of their roles effectively, internal auditors must be accomplished in anticipating emerging issues and creating solutions. They must also have business acumen, critical thinking skills, and be excellent communicators who listen attentively, speak effectively, and write clearly.

Through their varied roles and responsibilities, internal auditors provide the organisation tremendous value. They serve as the eyes and ears of senior management and the board.

They are coaches, internal and external stakeholder advocates, risk and control experts, efficiency specialists, fact-checkers, and problem-solvers. They identify both risks and opportunities, and they tell it like it is.

It’s certainly not easy, but for these skilled and competent professionals, it’s all in a day’s work.

The Institute Of Internal Auditors Zimbabwe, was established in 1988 as an affiliate chapter to the global Institute of Internal Auditors (1941). The Institute of Internal Auditors (IIA) is the internal audit profession’s global voice, recognised authority, acknowledged leader, chief advocate, and principal educator worldwide.

The IIA serves members from all around the world in internal auditing, governance, internal control, IT auditing, education, and security.

The world’s leader in certification, education, research, and technological guidance for the profession, The Institute sets the International Standards for the Professional Practice of Internal Auditing and provides various levels of accompanying guidance; certifies professionals through the globally recognised Certified Internal Auditor® (CIA®) and specialty certifications in government, control self-assessment, and financial services; presents leading-edge conferences, seminars for professional development; produces forward-looking educational products; offers quality assurance reviews, benchmarking, and consulting services; and creates growth and networking opportunities for specialty groups.

In support of quality, professionalism, and ethical practices, the Institute provides internal audit practitioners, executive management, boards of directors, and audit committees with guidance for internal auditing and governance best practices.

IIA Zimbabwe is dedicated to providing extensive support and services to its members, so they can continue to add value across the board.

SOURCE : THE HERALD

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