The standards of Internal Auditing:
The standards are principles on which practice of internal auditing is based. They are part of IPPF and applicable to every environment and organization. Whether services are in-sourced or outsourced, these standards must be understood and appropriately applied by the internal audit professionals.
Chief Audit Executive (CAE) and the whole audit team will be held accountable for the internal audit activity on the basis of these standards.
The purpose of the standards is to:
- State basic principles of internal audit with mandatory elements of IPPF
- Provide framework for performing and promoting internal audit activities.
- Establish the basis for internal audit performance
- Improve organizational processes and operations
Classification of standards
These standards are further classified in the following three categories:
- Attribute Standards
This standard deals with the responsibilities, characteristics, attitude and actions relating to internal auditor and internal audit activity of the organization. These standards numbered in 1000’s,
- 1000 – Purpose, Authority and responsibility
- 1100 – Independence and Objectivity
- 1200 – Proficiency and due professional care
- 1300 – Quality Assurance and / Improvement Program
- Performance Standards
This standard deals with the nature of internal auditing and provides quality criteria for evaluating the internal audit function’s performance. It applies to all internal audit services. These standards numbered in 2000’s,
- 2000 – Managing the internal audit activity
- 2100 – Nature of work
- 2200 – Engagement planning
- 2300 – Performing the engagement
- 2400 – Communicating results
- 2500 – Monitoring progress
- 2600 – Management acceptance of risks.
- Implementation standards
These standards are integrated with attribute and performance standards. They are further extension of the above standards but pertain to specific services which are – Assurance (A) and Consulting (C) services.