Internal auditors launch financial services code
Internal auditors in banks and other financial firms have a new code of guidance which includes a sector-specific benchmark against which boards and regulators can assess the effectiveness of their internal audit functions.
Responding to the recent report from the Parliamentary Commission on Banking Standards, the Chartered Institute of Internal Auditors wants chief internal auditors to have sufficient standing and authority to challenge the executive and communicate their concerns to the board.
Other key recommendations are as follows:
The scope of internal audit should be unrestricted so that internal auditors can assess the management of any risk in any part of the business.
Internal audit should assess whether the organisation’s processes and actions are in line with its values, ethics, risk appetite and other policies.
In order to maximise its independence and objectivity, the primary reporting line of internal audit should be to the chair of the audit committee.
Internal audit should be adequately resourced, skilled and quality assured.