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April 2016 //
Canadian Government Executive /
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Internal Audit
2
Provide full visibility into
the activities of Internal
Audit and how well they are
functioning.
• Agree on a set of specific Internal Audit
activities to focus on and periodically re-
port on performance
• Have a Quality Assurance Review con-
ducted on the Internal Audit function at
least every 5 years.
Inform the Audit Com-
mittee of the results to provide them with
basis for understanding the quality of the
Internal Audit function and where it can
be improved
• Have regular informal communication
and encourage one on one meetings to
have open discussions to foster transpar-
ency
• Share the strengths and weakness of the
Internal Audit function.
Discuss limita-
tions of the Internal Audit department’s
skillset and resources. Share what things
Internal Audit can’t do as well so there are
no surprises.
• Obtain continuous feedback on the in-
formation being provided to the Audit
Committee.
Are they receiving the right
information in an understandable format
in order to make the right decisions?
• Validate Internal Audit’s performance.
Don’t just send out a survey when you
want to know how the Audit Committee
rates your performance. Consider asking
an independent party to sit down with the
Audit Committee and have a conversation
on how Internal Audit is doing.
3
Be full partners in the de-
velopment of the Internal
Audit department including
strategic objectives, audit
plan and related activities.
• Have open communication channels
with the Audit Committee Chair and the
entire Audit Committee.
Ask to attend the
entire Audit Committee meeting.
• Keep the Audit Committee informed.
Ideally, Internal Audit serves as the eyes
and ears of the Audit Committee.
• Provide education/training when appro-
priate
• Share and ask for input on Internal Au-
dit’s long term strategy/vision
• Report on Internal Audit’s maturity.
Con-
sider utilizing the Institute of Internal Au-
dit Research Foundation’s Internal Audit
Capability Model.
• Have a seat at table.
Is the CAE a true
Senior Executive of the company to help
get the right level of visibility and respect?
• Involve/ inform the Audit Committee
of key Internal Audit department initia-
tives and decisions
• Provide regular updates on new devel-
opments regarding the Internal Audit
team
Although each organization is unique, it
is important that the Chief Audit Execu-
tive gain the Audit Committee’s support
and trust. Building an effective relation-
ship with the Audit Committee should be
a key component of Internal Audit’s over-
all strategy.
In summary, the Audit Committee
should:
• Have a clear understanding of the
depth and breadth of Internal Audit’s
role including how it fits into the over-
all governance design at the enterprise.
• Have full visibility into the activities of
Internal Audit and how they are func-
tioning.
• Be full partners in the development of
Internal Audit objectives, audit plan
and related activities.
Internal Audit should strive to be a trust-
ed advisor to the Audit Committee and
play a leading role. It is imperative that
Internal Audit continually advise the
Board and Audit Committee as they are
in the ideal position to provide advice on
key risks because they understand the
business. That means going beyond the
Institute of Internal Auditors Standards
and investing in excellence.
Ask yourself:
are you ready to dance?
Reference
1. 2015 Global Internal Audit
Common Body of Knowledge
(CBOK) Practitioner Survey
C
indy
K
ailly
-S
mith
is the Institute
of Internal Auditors District Rep-
resentative for Western Canada and
Manager Audit Services for British
Columbia Lottery Corporation.
G
urmit
A
ujla
is the Director of Audit
Services for British Columbia Lottery
Corporation.
Although each
organization is unique,
it is important that the
Chief Audit Executive
gain the Audit
Committee’s support
and trust. Building an
effective relationship
with the Audit
Committee should
be a key component
of Internal Audit’s
overall strategy.