Compliance and Financial Audits – Distinctions With Substance

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2 Responses

  1. Frank Numann says:

    Michael,,
    I think that a modern internal audit department has another important role to play in the area of Compliance. Modern Internal Audit is an independent verification that ANY business process is operating as designed and is effective in controlling the risk that it was designed to cover. Financial audits are only a part of the IA remit.
    What IA should do, is to review the Compliance Department and its procedures/operation and provide an independent opinion to the Board (via the Audit Committee) whether Compliance is well organised, has installed the right (and complete!) controls and that they are operating as designed.
    I know to some this may sound like being the policeman of the policemen, but it is an important assessment that allows the Board to form itself an opinion on the effectiveness of the Compliance organisation. As we all know, those close to an operation often have difficulty seeing its own weaknesses: IA can provide an import additional check in that respect. Some companies do this as well as inviting an Ethics NGO to make an outsider’s assessment

  1. May 4, 2017

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