International Standards for the Professional Practice of Internal Auditing (Standards):
Standards are principle-focused and provide a framework for performing and promoting internal auditing. The Standards are mandatory requirements consisting of:
- Statements of basic requirements for the professional practice of internal auditing and for evaluating the effectiveness of its performance. The requirements are internationally applicable at organizational and individual levels.
- Interpretations, which clarify terms or concepts within the statements.
- Glossary terms.
It is necessary to consider both the statements and their interpretations to understand and apply the Standards correctly. The Standards employ terms that have been given specific meanings as noted in the Glossary, which is also part of the Standards.
The Institute of Certified Internal Auditors (ICIA-PAKISTAN) adopted and follows the standards set by the International Internal Audit Standard Board (IIASB).
Standards for the Professional Practice of Internal Auditing:
The purpose of the Standards for the Professional Practice of Internal Auditing (the Standards) is to provide auditors with specific professional guidance relating to the responsibilities of internal auditing.
Summary of General and Specific Standards for the Professional Practice of Internal Auditing
- 100 INDEPENDENCE
- 200 PROFESSIONAL PROFICIENCY
- 300 SCOPE OF WORK
- 400 PERFORMANCE OF AUDIT WORK
- 500 MANAGEMENT OF THE INTERNAL AUDITING DEPARTMENT
100 Independence — Internal Auditors should be independent of the activities they audit
- 110 Organizational Status — The organizational status of the internal auditing department should be sufficient to permit the accomplishment of its audit responsibilities.
- 120 Objectivity — Internal Auditors should be objective in performing audits.
200 Professional Proficiency — Internal Audits should be performed with proficiency and due professional care.
The Internal Auditing Department
- 210 Staffing — The internal auditing department should provide assurance that the technical proficiency and educational background of internal auditors are appropriate for the audits to be performed.
- 220 Knowledge, Skills, and Disciplines — The internal auditing department should possess or should obtain the knowledge, skills, and disciplines needed to carry out its audit responsibilities.
- 230 Supervision — The director of internal auditing should ensure that internal audits are properly supervised.
The Internal Auditor
- 240 Compliance with Standards of Conduct — Internal auditors should comply with professional standards of conduct.
- 250 Knowledge, Skills, and Disciplines — Internal auditors should possess the knowledge, skills, and disciplines essential to the performance of internal audits.
- 260 Human Relations and Communications — Internal auditors should be skilled in dealing with people and in communicating effectively.
- 270 Continuing Education — Internal auditors should maintain their technical competence through continuing education.
- 280 Due Professional Care — Internal auditors should exercise due professional care in performing internal audits.
300 Scope Of Work — The scope of internal auditing should encompass the examination and evaluation of the adequacy and effectiveness of the organization’s system of internal control and the quality of performance in carrying out assigned responsibilities.
- 310 Reliability and Integrity of Information – Internal auditors should review the reliability and integrity of financial and operating information and the means used to identify, measure, classify, and report such information.
- 320 Compliance with Policies, Plans, Procedures, Laws, and Regulations, and Contracts — Internal auditors should review the systems established to ensure compliance with those policies, plans, procedures, laws, and regulations, and contracts which could have a significant impact on operations and reports, and should determine whether the organization is in compliance.
- 330 Safeguarding of Assets — Internal auditors should review the means of safeguarding assets and, as appropriate, verify the existence of such assets.
- 340 Economical and Efficient Use of Resources — Internal auditors should appraise the economy and efficiency with which resources are employed.
- 350 Accomplishment of Established Objectives and Goals for Operations or Programs — Internal auditors should review operations or programs to ascertain whether results are consistent with established objectives and goals and whether the operations or programs are being carried out as planned.
400 Performance Of Audit Work — Audit work should include planning the audit examination and evaluating information, communicating results and following up.
- 410 Planning the Audit — Internal auditors should plan each audit.
- 420 Examining and Evaluating Information — Internal auditors should collect, analyze, interpret, and document information to support audit results.
- 430 Communicating Results — Internal auditors should report the results of their audit work.
- 440 Following Up — Internal auditors should follow up to ascertain that appropriate action is taken on reported audit findings.
500 Management Of The Internal Auditing Department — The director of Internal Auditing should properly manage the Internal Auditing Department.
- 510 Purpose, Authority, and Responsibility — The director of internal auditing should have a statement of purpose, authority, and responsibility for the internal auditing department.
- 520 Planning — The director of internal auditing should establish plans to carry out the responsibilities of the internal auditing department.
- 530 Policies and Procedures — The director of internal auditing should provide written policies and procedures to guide the audit staff.
- 540 Personnel Management and Development — The director of internal auditing should establish a program for selecting and developing the human resources of the internal auditing department.
- 550 External Auditors — The director of internal auditing should coordinate internal and external audit efforts.
- 560 Quality Assurance — The director of internal auditing should establish and maintain a quality assurance program to evaluate the operations of the internal auditing department.
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