(Russell Bedford International Accounting Bulletin – January 2020)
UK - The Chartered Institute of Internal Auditors (Chartered IIA) has published a new code with the goal of increasing the effectiveness of internal audit functions. The Internal Audit Code of Practice aims to strengthen corporate governance, following a number of high-profile collapses linked to governance deficiencies, such as the collapse of UK construction company Carillion.
The code aims to increase the status, scope and skills of internal audit, and makes 38 recommendations for business including:
The Internal Audit Code of Practice was developed by an independent steering committee set up by the Chartered IIA and chaired by BP audit committee chair Brendan Nelson. The final version follows a 12-week public consultation in which more than 100 stakeholders participated. Nelson said: “High-profile corporate collapses linked to governance deficiencies have led to a wide-ranging review of the audit and corporate governance framework. Strong, effective and well-resourced internal audit functions have a central role to play in supporting boards to better manage and mitigate the risks they face.
“The Code makes 38 important recommendations, including the right for internal audit to attend executive committee meetings, unrestricted access for internal audit to all parts of the business and a direct line for internal audit to the chief executive. “I urge boards, and in particular audit committees, to apply appropriately the Internal Audit Code of Practice to increase the effectiveness of their internal audit functions, in the pursuit of stronger corporate governance and risk management.”
UK Financial Reporting Council CEO Jon Thompson said: “I commend the IIA for developing and introducing this new code of practice, which sets a high standard of best practice.
13:46 - 06/05/2021