IIA Chairman Cites Four Challenges For Internal Auditors

The Institute of Internal Auditors Chairman LeRoy E. Bookal has outlined the key challenges confronting internal auditors after the recent round of accounting scandals and legislative reforms. The challenges focus on ways to create a working environment conducive to creating opportunities for internal auditors to add value.

For maximum value-added, Mr. Bookal urges internal auditors to concentrate on these areas:

  1. Working relationships. Internal auditors must do their part to establish and maintain good working relationships. There should be a comfort level that allows any of the four key parties (management, directors, external auditors and internal auditors) to pick up the phone at any time and seek advice, either as a group or in a private session.

  2. Awareness and problem-solving. In addition to ensuring that activities on the audit plan are performed each year, internal auditors must also participate actively in planning sessions and meetings. By cultivating a solid understanding of the business and its challenges internal auditors can go beyond just pointing out what is wrong and become part of the solution.

  3. Professionalism.
  4. Ways to convince management, the board, and the general public of the value that internal auditors can bring to governance processes include: complying with the Code of Ethics and Standards for the Professional Practice of Internal Auditing, obtaining The IIA's Certified Internal Auditor designation and using formal quality assurance review mechanisms.

  5. Progress through sharing. Every major audit failure or control breakdown brings with it an opportunity to learn from the experience of others. After an event like Enron, auditors in all organizations should analyze what happened and why it happened so that they can apply this knowledge to their own organizations.

Mr. Bookal recognizes that the above may require internal auditors to "step out of their traditional comfort zone." But, he says, the results will be well worth it. By stepping up to these challenges, internal auditors can add value to their own organizations and employers and also help businesses and the public better understand the important roles that internal audits play in the process of corporate governance.

-Rosemary Schlank

You may like these other stories...

The Public Company Accounting Oversight Board (PCAOB) on Tuesday adopted a new auditing standard and amendments in three areas of the audit that could pose an increased risk of material misstatement in company financial...
Read more from Larry Perry here and in the Today’s World of Audits archive.In my last article, I presented an overview of one of the first steps in the preplanning phase of an audit engagement: reviewing prior year...
Read more from Larry Perry here and in the Today’s World of Audits archive.AU-C Section 800, Special Considerations—Audits of Financial Statements Prepared in Accordance with Special Purpose Frameworks (SPFs),...

Already a member? log in here.

Upcoming CPE Webinars

Sep 24
In this jam-packed presentation Excel expert David Ringstrom, CPA will give you a crash-course in creating spreadsheet-based dashboards. A dashboard condenses large amounts of data into a compact space, yet enables the end user to easily drill down into details when warranted.
Sep 30
This webcast will include discussions of important issues in SSARS No. 19 and the current status of proposed changes by the Accounting and Review Services Committee in these statements.
Oct 23
Amber Setter will show the value of leadership assessments as tools for individual and organizational leadership development initiatives.
Oct 30
Many Excel users have a love-hate relationship with workbook links. For the uninitiated, workbook links allow you to connect one Microsoft Excel spreadsheet to other spreadsheets, Word documents, databases, and even web pages.