Blog: Are Boards Negligent When Internal Audit Heads Are Hired and Fired?
In his blog, IIA President and CEO Richard Chambers, CIA, QIAL, CGAP, CCSA, CRMA, shares his personal reflections and insights on the internal audit profession. Here’s an excerpt from his latest post:
Great internal audit functions are noted for their organizational independence, and the professional men and women who lead them are noted for their objectivity. It’s for these reasons that the establishment of separate functional and administrative reporting lines that foster that independence and impartiality is so critical.
As I first noted in a 2016 blog, I often observe that chief audit executives (CAEs) are less likely to be unduly influenced by management when they have a strong functional reporting relationship to the board or audit committee. Without such a relationship, it is very easy for management to confine the scope of internal audit’s work and to suppress unfavorable results.
From time to time, there are surveys that offer encouraging statistics on the percentage of internal audit departments with a functional reporting relationship to the audit committee. The percentage is often 70 percent or more.