Draft code aims to boost internal audit standards

A draft code has been launched by the Chartered Institute of Internal
Auditors that makes 30 recommendations to strengthen corporate governance.

The Internal Audit Code of Practice has been developed by an independent steering committee, set up by the Chartered IIA to help reduce the risks of major corporate collapses.

Brendan Nelson, Internal Audit
Code of Practice steering committee chair, said: “One of the best ways to help
organisations better protect their assets and manage risk is to boost the
status, standards, scope and skills of internal audit.

The draft Internal Audit Code of Practice contains 30 recommendations to strengthen corporate governance, including unrestricted access for internal audit, full access for internal audit to senior meetings and full access for internal audit to key management information, according to Mr Nelson, who is audit committee chair of BP.

He added: “The draft code offers
invaluable guidance about raising internal audit performance to help businesses
and other organisations protect their assets, reputation and sustainability.”

According
to the Chartered IIA, the draft code is the first time businesses and
organisations outside of the financial services sector will be given
comprehensive benchmarks to meet and detailed guidance about running an
effective internal audit function.

It
builds on the institute’s work in developing a Financial Services Code in 2013.

Dr
Ian Peters, chief executive of the Chartered IIA, said the code raised the
profile and effectiveness of internal audit, with the number of chief audit
executives attending executive committees rising from 48% to 84%.

He
said: “We want to hear what businesses and other organisations would like to see
in the first ever Internal Audit Code of Practice and encourage them to take
part in the public consultation we have launched today.”

Members
of the Internal Audit Code of Practice steering committee include Carolyn
Clarke, head of audit, risk and control at Centrica and Byron Grote, audit
committee chair at Tesco and Anglo American.