Review: Internal Auditing Around the World
of Internal Audit Functions at Leading International Companies,
Volume 1 (June 2005, 54 pages) and Volume 2 (June 2006, 55 pages)
Published by Protiviti Inc. (free download available at www.protiviti.com)
by Heriot C. Prentice
MAY 2007 - Internal
audit is a global profession that practices by a set of international
standards (International Standards for the Professional Practice
of Internal Auditing), a code of ethics, and practice advisories
that can be found in the Professional Practices Framework of the
Institute of Internal Auditors (IIA; www.theiia.org).
While all internal auditors follow this guidance, many organizations
strive for improvement. These volumes provide insight into the working
practices of the internal audit function of multinational organizations
of varying size that have developed and honed their audit skills
and are recognized as industry leaders in this field.
1 focuses on the audit profession’s core issues,
such as corporate governance, ethics, fraud, risk, and controls.
It also provides some common themes that other companies can adopt
as a way to improve their practices. While 13 organizations are
featured, Protiviti makes it clear that many others have committed
to excellence and may be featured in subsequent editions.
is helpful to internal audit professionals as well as those who
have not yet joined the profession or who know very little about
internal audit. It is a must-read for CEOs, CFOs, CPAs, audit
committee members, boards of directors, and others in business
who continually seek improvement and best practices.
The 13 companies share several key themes that are common to all
that wish to deliver high performance in the development of an
internal audit function:
governance: Tone at the top.
assurance/performance measurement: Are we doing things correctly?
How can we improve?
management: Internal controls, principles, and values.
Recruit talented people with a variety of skills.
Act: For the U.S. companies featured, this was a major point;
the main theme was to seek operational effectiveness and efficiencies.
the companies featured are industry leaders, they continue to
strive for improvement in their working practices, to seek greater
efficiencies and effectiveness in their organizations, and to
become truly global leaders in the area of internal audit.
2 builds on the 13 global companies featured in
Volume 1. It provides insight into the operational practices of
14 global companies that have gone beyond standard internal audit
practices and have developed and delivered operational effectiveness
and added value, and have implemented both innovative and best
practices across their companies on a global basis.
the common themes discussed in Volume 1 have shifted because the
dynamics of our business environment changed in only one short
year. A main theme that stands out in both volumes, however, is
the importance of people. Human resources is a critical factor
in any business, even more so in the internal audit function because
good companies are always on the lookout for highly intelligent
people with diverse knowledge to staff multifunctional teams.
There has never been a better time to be an internal auditor,
but demands for staff are high.
the first volume, this publication is a must-read for CEOs, CFOs,
CPAs, audit committee members, and boards of directors who continually
seek improvement and new challenges within their organization
or for those they serve.
highlights each company individually and explores the various
ways in which they have created and grown their internal audit
function. The companies range in size and global stature. This
provides a great benefit because it allows readers to benchmark
what has worked effectively at a certain company and to assess
what may work for them. The company selection provides a great
variety among business sectors, again adding great value when
trying to benchmark an organization against them.
the report examines only 14 high-level companies, several key
best- practice themes are necessary for any company that wants
to deliver high performance in the internal audit function:
Implement a top-down, risk-based approach.
Hire the best people, with varied backgrounds. Use internal
audit as part of management training and for career development
Performance measurement, relationship management, client satisfaction.
If a company lacks the internal audit skills it needs internally,
it should buy them.
executives are now far more accountable, with far greater emphasis
on corporate governance and tone at the top. The internal audit
profession is still growing and as such continues to develop better
practices to create efficiency and effectiveness in the business
world, ensuring that stakeholders are protected by strong internal
controls and better working practices. As the profession continues
to grow, I look forward to future volumes or editions in this
series as a check on where we are as professional internal auditors.
C. Prentice, MIIA, FIIA, QiCA, is the director of technology
practices at the Institute of Internal Auditors (www.theiia.org).