Internal auditing has evolved from a traditional appraisal activity to an objective, assurance, and consulting activity. Internal auditing is viewed as a value-added service that improves the organization's operations, risk management, internal controls, and financial reporting. Internal auditors' roles changed from merely providing input and objective feedback to management, to directly participating in corporate governance, and thus, in the decision-making function. The CAE is primarily responsible for managing, directing, and overseeing the internal audit function. The company's audit committee is directly responsible for hiring, compensating, firing, and overseeing the work of the CAE. This chapter discusses the role of internal auditors in corporate governance.
The primary objectives of this chapter are to