introduction to the international standards

8/3/2019 Introduction to the International Standards

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An introduction to theinternational standardsfor the internal audit profession

Informing. Inspiring. Assuring.


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The Defnition o Internal Auditing

Internal auditing is an independent, objective

assurance and consulting activity designed to addvalue and improve an organisations operations.It helps an organisation accomplish objectivesby bringing a systematic, disciplined approachto evaluate and improve the eectiveness o riskmanagement, control and governance processes.

The Code o Ethics

Proessional internal auditors behave in accordancewith our principles: integrity, objectivity,confdentiality and competency. I you have

concerns about the behaviour o a member othe Institute, you can tell us. A ull copy o theCode o Ethicscan be ound on our web site.

International Standards or theProessional Practice o Internal Auditing

The International Standardsare principles-based, mandatory requirements covering49 aspects o internal auditing.

Summary of the Standards

The Standardsare organised into twocategories: attribute and perormance.

Attribute standardsAddress the attributes o organisations andindividuals perorming internal audit services.

Performance standardsDescribe the nature o internal audit servicesand provide quality criteria against which theperormance o these services can be measured.

Why internal audit standardsare good for you

Whether you are a manager in an organisation,responsible or taking controlled risks or adirector or trustee or other type o governoroverseeing the activities that manage risks, youwelcome objective assurance that those risks arebeing managed eectively. Proessional internalauditors can provide that objective assuranceand help you when you need to take actionto improve your system o internal control.

The Institute good for standards

The Institute o Internal Auditors has setinternational standards or internal auditors or over30 years so that you can rely on the assurancethat proessional internal auditors provide.

In 2009, the Institute launched a new versiono the standards re-engineered to meet theneeds o the 21st Century the InternationalProessional Practices Framework or IPPF. Themost important parts o the ramework arethe Defnition o Internal Auditing, the Code oEthicsand the International Standards or theProessional Practice o Internal Auditing.

The processes ollowed to develop thesestandards are robust and transparent, includingperiods o public consultation and comment.

Key elements of the IPPF:

This guide summarises the key eatures and rationale o theproessional standards, which unite and bind the global communityo over 165,000 internal auditors. Full copies are available

rom the IIA UK and Ireland. See back cover or details.

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Internal audit a cornerstoneof governance

Internal audit is one o the cornerstones ogovernance, together with the board directors (orother governors), managers and external audit.

Well governed organisations take managedrisks. Internal audits role is to provide bothgovernors and managers with objective andindependent assurance that the governanceprocesses and the entire system o internalcontrol is working eectively. That meansthat risks are being identifed and managedwithin the organisations appetite or risk.

To do this, internal audit must have theright reporting lines, resources and skills anddo the right things in the right way. Thisis where the IPPF comes in its standardsand guidance describe the right way!

Attributes of internal auditors

The purpose, authority and responsibilityo internal audit is defned in a charterthat recognises the proessional standardsand that is approved by the organisationsgoverning body and management.

Internal audits organisational independenceand internal auditors objectivity are protectedby direct reporting to the governing body.

Internal auditors undertake work only when theyhave the knowledge, skills and other competenciesnecessary. Proessional qualifcations andcommitment to ongoing learning are essential.

The head o internal audit is responsible orcreating an ongoing programme o activitiesto ensure the quality o internal audit; to obtainperiodic independent confrmation o itsquality; and to strive to improve continuously.

Performance of internal audit work

The head o internal audit works with theorganisations management and other assuranceproviders to develop and deliver risk-basedplans; and reports plans, perormance andsignifcant issues to the governing body.

Internal audits scope o work covers evaluatingand helping to improve all aspects o theorganisations governance and system o internalcontrol, including the management o risk.

Internal auditors plan their work so that itmeets its objectives, particularly agreeing the

criteria they will use. Internal auditors identiy,analyse, evaluate and document evidence,on which to base their conclusions.

Internal auditors communicate the results otheir work to managers and governors whocan take action; monitor whether agreedactions are completed; and discuss with seniormanagement and the governing body whenunacceptable levels o risk are being taken.

Governors

Internalaudit

External

audit

Managers

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vernance

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www.iia.org.ukThe Institute o Internal Auditors UK and Ireland Ltd

13 Abbeville Mews, 88 Clapham Park Road, London SW4 7BXtel 020 7498 0101 fax 020 7978 2492 email [email protected]

Registered in England and Wales, no. 1474735 January 2009. Inormation can be made available in other ormats.

Informing. Inspiring. Assuring.The IIA is the only body ocused exclusively on internal auditing and we are passionate

about supporting, promoting and training the proessionals who work in it. Wehave been leading the proession o internal auditing or over 60 years.

The IIA plays an active role in the public arena, building awareness o internal auditing,

promoting members interests and challenging organisations to reach the higheststandards o corporate governance. We are committed to enhancing the recognition

and proessionalism o internal audit in the UK and Ireland, through:

Dynamic leadership o the proession which maximises the reputationand inuence o our members, both individually and collectively

Setting perormance benchmarks and promoting proessional integritythrough ourInternational Standardsand Code o Ethics

Continually developing our qualifcations so that their high quality andreputation is maintained, Providing technical resources, networking

opportunities and support to our members throughout their careers

Maintaining our position as the market leader in internal audit training

Full copies of the standardsPrinted copies o the standards summarised here are

available rom the Institute, price 35. Printed copieso the complete IPPF are also available.

introduction to the international standards

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