Resources

“Progress is impossible without change, and those who cannot change their minds cannot change anything.” – George Bernard Shaw
Many organisations face challenges in evolving their internal audit function to be more efficient and technologically advanced. As the former CEO of SWAP Internal Audit Services, we were fortunate to have both the budget and the headroom to invest in efficient processes supported by technology, and I’ve witnessed first hand the benefits that a mature internal audit can bring: enhanced governance, risk management, and control processes that position the organisation for success.
Read more: Elevating Internal Audit Maturity: Technology, Innovation, and Zero-Based Budgeting | AuditBoard

In today’s fast-paced business environment, organisations must navigate a complex landscape of risks and opportunities. Traditional risk management approaches, often reactive and siloed, are no longer sufficient. Enter Objective-Centric Risk Management (OCRM) and Dynamic Assurance Mapping — innovative strategies that align risk management with strategic objectives and leverage real-time data to provide continuous, actionable insights. 
For those who are not familiar with these terms:
OCRM is a proactive approach that aligns risk management activities with an organisation’s strategic objectives, using real-time data for continuous monitoring and adjustment. 
Dynamic Assurance Mapping is a visual tool that coordinates and aligns assurance activities across an organisation, using real-time data to ensure comprehensive risk and compliance coverage. 
Read more: Harnessing Real-Time Data With Objective-Centric Risk Management and Dynamic Assurance Mapping | AuditBoard

Check back for more news and updates…

As of January 1, new provisions of the UK Corporate Governance Code designed to strengthen risk management and accountability are in force with further requirements commencing next year. Many organisations are still scrambling to implement necessary changes to their risk and control programmes.
AuditBoard’s report, UK Corporate Governance: Turning Compliance Into a Strategic Advantage, revealed that 89% of professionals expect an increase in workload due to the new provisions while citing a lack of bandwidth coupled with a misalignment of priorities across their organisation as the biggest obstacles. Perceived shortfalls in resources, stakeholder buy-in, clarity of responsibilities, expertise, budgets, and technology further compound this problem.
Read More: Governance and Culture: 5 Areas to Address the New Corporate Governance Code | AuditBoard

I recently talked with a colleague whose organisation demanded a 50% cut in the internal audit budget inside four months. There was no discussion about how this might affect assurance and advice on risks and controls. It was viewed solely as a necessary efficiency gain.
This kind of “silent cutting” is nothing new and we should expect — even welcome — tough conversations with our CFOs about costs versus value and return on investment. Having to justify our spend is a necessary part of transparency and accountability.
Read More: Leveraging the Standards During Budget Discussions: Making the Case for Investing in Internal Audit | AuditBoard

There is only one thing in life worse than being talked about, and that is not being talked about.”
So said Oscar Wilde, and we could say the same about auditing. We may sometimes wish to shun attention, avoid asking difficult questions, submit a safe report, and go for the easy win. That way we know we won’t be making any waves or getting into awkward and potentially combative conversations. But if our work is not the subject of conversation, we’re unlikely to make a difference.
Read More: Why Internal Auditors Should be Rocking the Boat | AuditBoard

DAVID HILL – JANUARY 2024

The Four Agreements: Getting Ready for the New Year

Ever since the new year began with the month named after the two-faced god Janus, it’s been customary to look back while planning forward. This time of year always reminds me of a particular bit of wisdom that is especially apt for internal auditors and audit functions.
Don Miguel Ruiz’s book “The Four Agreements: A Practical Guide to Personal Freedom” is more than 25 years old. Its central ideas are much older still, originating in the first millennium CE with the Toltec culture, a precursor to the Aztecs. It is very much in the same vein as this quote from the 13th-century poet and mystic Rumi: “Yesterday I was clever, so I wanted to change the world. Today I am wise, so I am changing myself.”
Read More: The Four Agreements: Getting Ready for the New Year | AuditBoard

david hill – July 2023

Understanding the Internal Audit Value Chain to Enhance Performance

As internal auditors, we are experts at analysing process design, policy implementation, and project execution. We readily grasp the big picture and identify potential improvements to organisational governance, risk management, and internal control. However, we are less good at applying these same skills to our own work. We know how to conduct a value-for-money audit, but use only rudimentary measures of our own economy, efficiency, and effectiveness.
If we want to be credible and be seen as trusted advisors rather than just an overhead, then we must lead by example. In one of Aesop’s fables, by issuing the following challenge, an astute fox exposes the deceit of the wrinkled and blotchy frog who claims he can cure any ailment: “If you are so talented, I say, physician, heal thyself.”
Read More: Understanding the Internal Audit Value Chain to Enhance Performance | AuditBoard

the audit committee

The Audit Committee and organisational effectiveness in Local Authorities

This guide explains the value an audit committee brings to the local authority. It is aimed at those in a governance or leadership role in an authority, who interact with the committee or receive its reports.
Read more: Local authority audit committees

global internal audit standards

Global Internal Audit Standards are now in full effect.

Internal audit functions are expected to be in conformance with the 2024 Global Internal Audit Standards^TM now. Access the Standards and related resources. The Standards guide the worldwide professional practice of internal auditing and serve as a basis for evaluating and elevating the quality of the internal audit function. The Standards are set according to a due process followed by the International Internal Audit Standards Board and overseen by the IPPF Oversight Council.

FINANCIAL REPORTING COUNCIL 2023

Audit Committees

The FRC has produced guidance relating to Audit Committees, and published a Standard for Audit Committees relating to the external audit.
Audit Committees should also familiarise themselves with the UK Corporate Governance Code.
Read More: Audit Committees

audit committees

Audit and Risk Assurance Committee (ARAC) Handbook

This Audit and Risk Assurance Committee (ARAC) Handbook has been refreshed and expanded to improve clarity and reflect changes in best practice in governance. The handbook covers the role and responsibilities of an ARAC and provides guidance on good governance processes for ARACs.
Whilst it is not intended to provide guidance on areas that an ARAC may need to review, Annex F ’Key questions for an ARAC to ask’ does provide prompts of what ARACs should consider on a range of topics, including whistleblowing and cyber security. This Annex is not meant to be an exhaustive (or restrictive) list of questions relating to a particular topic. Annex H is a checklist which an ARAC could use to review its effectiveness.
Read More: Audit and Risk Assurance Committee Handbook – GOV.UK

AUDIT COMMITTEES

Ten Questions for the Audit Committee

The role of the audit committee is normally to seek assurance that the council’s financial reporting, internal controls, governance, and risk management are effective and can be relied upon by councillors and citizens. The audit committee is the committee of the council to which has been delegated the task of looking into such matters in detail.
Read More: Ten questions for audit committees | Local Government Association

INTERNAL AUDIT

Code of Practice for the Governance of Internal Audit in UK Local Government

CIPFA has introduced a new Code of Practice to support authorities in establishing and maintaining their internal audit arrangements in line with the statutory regulations. The Code supports the practice of internal audit under the Global Internal Audit Standards in the UK Public Sector.
The Code is aimed at those responsible for the governance of internal audit and is also relevant for heads of internal audit and audit providers to the sector. 
It applies to all local government bodies using the Global Internal Audit Standards in the UK Public Sector. Those bodies should use the Code regardless of how their internal audit function is provided.
CIPFA consulted on the Code in 2024 and it is applicable from 1 April 2025.
Read More: Governance of Internal Audit in Local Government | CIPFA