Question

Discuss if and how the current market and business environment affects the following within the internal auditing profession:  

1). Internal Audit’s role & status within an organization,

2) Its relationship with the external auditors,

3) Importance of the Certified Internal Auditor (CIA) designation, and

4) Do you think a few years working in Internal Auditing would be good for your professional career? Why or why not?

Answer 1

1. The role of internal audit is to provide independent assurance that an organization's risk management, governance and internal control processes are operating effectively. Internal auditors have a professional duty to provide an unbiased and independent view of the operations they evaluate and report the same to the highest level in an organization. Internal auditors deal with issues that are fundamentally important to the survival and prosperity of any organization. They consider issues such as the organization's reputation, growth, its impact on the environment and the way it treats its employees. In general, it is stated that internal audit's role is to enhance and protect organizational value by providing risk based and objective assurance, advice and insight. Hence, internal auditors are a critical part of the top level governance of any organization along with executive management, non-executive management and external auditors.

2.Although external and internal audit are clearly separate and distinct in their respective functions and duties, effective communication and planning between the two helps ensure that audit resources can be directed towards the more high risk areas of the organization. In regards to external auditor's responsibilities relating to fraud in an audit of financial statements, internal audit may be able to provide insight in relation to weaknesses in counter-fraud controls and/or fraud risk indicators within the organization. The external auditor may want to read copies of the reports issued by the internal auditor. Both the auditors can share intelligence on key events, changes and plans that may impact on the risk profile of the organization and therefore, on their work.

3. The CIA is the only globally recognized internal audit certification, so earning it is the optimum way to communicate one's internal auditing competencies. Moreover, the CIA is the single most important designation in the internal audit profession, and its value does not depreciate from country to country. Earning the CIA designation is a valuable accomplishment and a professional advantage for auditors at all stages of their careers, including chief audit executives, audit managers, audit staff, and risk management staff, as well as students enrolled in an accounting or other business or financial degree program.

4. The internal auditor is one of the in-demand finance and accounting positions in today's hiring market. Risk and compliance concerns are driving hiring at many companies, particularly in highly regulated industries like banking, insurance, healthcare and financial services. Internal auditors gain an in-depth, up-close understanding of the processes, policies and procedures of an organization. Partnering with management, internal auditors are able to provide invaluable operational knowledge and industry insights to companies, with frequent exposure to the board. That experience may shape the rest of our careers. High salaries are paid to the internal auditors. Thus, working in Internal auditing would be good for my professional career.