Internal audit practitioners globally are bearing the brunt of a quickly changing regulatory landscape, particularly in financial services, according to a survey by Thomson Reuters.
As organisations continue to play catch-up with a shifting regulatory environment the focus of internal audit practitioners’ roles is changing dramatically, and resources being stretched, as the function is asked to take increasing responsibility for company-wide corporate governance and reporting to the board.
Thomson Reuters Accelus surveyed more than 1,100 internal audit practitioners across Europe, the Americas, Australia, Asia, Africa and the Middle East to canvass their views on the state of internal audit and the greatest challenges for the year ahead. Respondents represented firms from sectors including financial services, manufacturing, government, education, life sciences, energy and other highly-regulated industries.
Key findings from the report include:
- Twenty-six per cent of organisations nominated fraud and corruption as one of their top three areas for time and resources, against 16% of organisations in 2012. Legal and regulatory risk occupied the same spot as last year, although fewer organisations nominated it.
- Sixty-one per cent of organisations’ audit committees only reported to the board on a quarterly basis whilst 12% were unsure how often they reported to the board and 2% only reported on an annual basis.
- Seven per cent fewer internal auditors said that they spoke to the compliance function on a weekly basis than in 2012, highlighting the need for more effective cross-function communication.
- Fifty per cent of auditors thought that the risk management tools they currently used either provided them with no satisfaction or left them very dissatisfied when used to conduct risk assessments.
“Changes driven by the financial crisis and implemented in the first instance by the financial services sector will, in time, permeate all sectors and set the standard for risk governance and the expected role and remit of the internal audit function,” said Mark Schlageter, managing director, governance, risk and compliance, Thomson Reuters.
“To meet increased expectations of both internal and external stakeholders, internal audit practitioners need the ability to tap greater resources as well as garner the clear support of their company right through to board level to truly achieve success in this changing operational environment.”
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