The Americas literature review on internal auditing

Abstract

Purpose -By conducting the 2006 global Common Body of Knowledge (CBOK) study, The Institute of Internal Auditors (The IIA) attempts to better understand the expanding scope of internal auditing practice throughout the world. The purpose of this review of recent internal auditing literature in The Americas is to document how the internal audit function is changing in response to the shifts in global business practices. Design/methodology/approach -The literature in The Americas is reviewed with a focus on developments that have implications for the expanded scope of internal auditing and the changing skill sets of internal auditors. This focus has implications for CBOK 2006. Findings -The literature indicates a paradigm shift in the activities performed by internal auditors. The increasing complexity of business transactions, a more dynamic regulatory environment in the USA, and significant advances in information technology have resulted in opportunities and challenges for internal auditors. Although in 2004, The IIA responded to the changing organizational environment by updating the professional practices framework, more work needs to be done to prepare internal auditors for the expanded set of skills and knowledge required to perform audits of the future. Originality/value -By presenting an overview of past literature in The Americas and discussing the shifting demands on internal audit services, the researchers hope to motivate further research in the field.

Value‐added role of internal audit: an Ethiopian case study

“…Generally, underscore that the internal audit function is moving away from confrontational, detectionfocused services to a prevention-focused service through a partnering approach with management, and away from a controls approach to a risk-based approach with a focus on consulting services. However, Hass et al (2006) point out that the increased regulatory requirements of the SarbanesOxley act (2002) led to internal audit's greater focus on compliance works than the case prior to the issuance of the act. Yet, it is worth noting that the focus on compliance might be value-adding (Roth, 2002), depending upon the context.…”

“…This characteristic makes information technology skills essential to build a value-added internal audit profile. Hass et al (2006) indicate that application of information technology knowledge and skills helps enhance efficient utilization of internal audit resources and suggests training internal auditors for computer skills to ensure their information technology expertise.…”

“…This approach possibly enables greater understanding of internal audit's role and a better prediction of the development directions of the value-added internal audit and of the internal audit profession. Hass et al (2006), in a review of the American literature, indicate that the external factors leading to changes in organisations resulted in the need for expanded role of internal audit. Generally, underscore that the internal audit function is moving away from confrontational, detectionfocused services to a prevention-focused service through a partnering approach with management, and away from a controls approach to a risk-based approach with a focus on consulting services.…”

“…Recent Common Body of Knowledge (CBOK) studies on internal audit Hass et al, 2006;Burnaby et al, 2006) and studies on the knowledge, skills and attitudes for the accounting profession (Palmer et al, 2004) suggest that internal auditors need to acquire a broad range of skills -including communication, interpersonal, problem-solving -and knowledge of general business, and information technology in addition to the technical knowledge of auditing. The studies also point out that personal attitudes to embrace the positive change in the profession are also considered essential.…”

“…The internal audit literature (Stern, 1994;Roth, 2000Roth, , 2002Roth, , 2003Gupta, 2001;Naggy and Cenker, 2002;Gramling et al, 2004;Abdolmohammadi et al, 2006;Cooper et al, 2006;Hass et al, 2006;Yee et al, 2007) is also focusing on this evolving role, which is considered of paramount importance to achievement of organizational goals Roth, 2003). Despite indicating that value-adding internal audit departments need to possess varying attributes based on the situational context (Roth, 2002), the literature is as yet not complete enough to answer the questions of if, how, and why these attributes are associated with a pattern of organisational contexts and/or situations.…”