Audit & Risk

Raising Standards

IIA Global is introducing two new professional Standards and updating some of its existing Standards with effect from 1 January 2017. So what are the changes?

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After a worldwide consultation process, IIA Global formally announced in October that it will be introducing two new professional Standards and updating some of its existing Standards with effect from 1 January 2017. The Standards are mandatory for all institute members and the internal audit activity they undertake – the chief audit executive is accountable for the internal audit activity’s overall conformance with the Standards. This makes it vital that you take the time to read the new additions and changes and assess how they will affect your work. The two new Standards relate to the reality that chief internal auditors are sometimes asked to take on risk management, compliance or other roles beyond internal auditing, and to situations where internal auditors have to perform an assurance engagement when they have previously consulted in the same area, causing conflicts with objectivity.

• New Standard 1112
“Chief audit executive roles beyond internal auditing – where the chief audit executive has, or is expected to have, roles and/or responsibilities that fall outside of internal auditing, safeguards must be in place to limit impairments to independence or objectivity.”

• New Standard 1130.A3
“The internal audit activity may provide assurance services where it had previously performed consulting services, provided the nature of the consulting did not impair objectivity and provided individual objectivity is managed when assigning resources to the engagement.”

In addition, the 2017 amendments introduce modifications to align the Standards more closely with the Core Principles – in particular to “aligns with the strategies, objectives and risks of the organisation” and “is insightful, proactive and future-focused”.

There are also updates to two existing Standards: 1320 “Reporting on the Quality Assurance and Improvement Programme” and 2060 “Reporting to Senior Management and the Board”. The changes include summarising in one Standard the required communications from the chief internal auditor to the board and senior management and introducing an enhanced annual requirement for chief internal auditors to report on their quality assurance and improvement programme and current level of conformance.
Last, but not least, the Standards Glossary has been updated to clarify the definitions of “board”, “Core Principles” and “chief audit executive” and Practice Advisories are being replaced with Implementation Guides. 

“The Standards and the other elements of the International Professional Practices Framework are the cornerstone of our work as internal auditors – they help us to deliver internal audits to the highest standard and protect the organisations we work for,” says Liz Sandwith, chief professional practice adviser at the Chartered IIA. “I tend to
think of them like the Highway Code when I learnt to drive; they tell me what I should do, why I need to conform and the consequences of non-conformance. Reviewing the Standards on a regular basis is a positive step in that it allows us to reflect on their relevance and, as in this instance, to create new Standards to reflect the changing world of internal audit.”

Click here to read more about the changes.

What are the Standards? 

The IIA Standards are a set of principles-based, mandatory requirements consisting of statements of core requirements for the professional practice of internal auditing and for evaluating the effectiveness of performance at organisational and individual levels and interpretations clarifying internal auditing terms or concepts. They apply to all IIA members worldwide and provide a framework for performing and promoting a broad range of value-added internal auditing services. They also help to foster improved organisational processes and operations.

The Standards, along with the Core Principles and the Code of Ethics, encompass all mandatory elements of the International Professional Practices Framework, so conformance with the Core Principles, the code and the Standards demonstrates conformance with all mandatory elements of the International Professional Practices Framework.

The IIA: find out more

Visit the main IIA site

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Raising Standards

IIA Global is introducing two new professional Standards and updating some of its existing Standards with effect from 1 January 2017. So what are the changes?