Internal Audit’s Governance Role
THE PROFESSION OF AUDITING has been with us for a long time. Archaeologists have found that around 3000 BC the scribes in Mesopotamia utilized elaborate clay tablet accounting records that contained ticks, dots, and checkmarks indicating the existence of an auditing function. Auditing certainly has evolved over the millennia and today we generally classify most business auditors as either external or internal auditors. An external auditor is chartered by a regulatory authority to visit an enterprise or entity and to review and independently report the results of that review. In the United States, external auditors are generally certified public accountants, who are state-licensed and follow the standards of the American Institute of Certified Public Accountants (www.aicpa.org). There also are other types of external auditors in fields such as reviewing compliance for medical equipment devices, television viewer ratings, or in multiple governmental areas.
Internal auditing is a broader and often more interesting field. As an employee or member of an enterprise, an internal auditor independently reviews and assesses operations in a wide variety of areas, such as accounting office internal control procedures or manufacturing quality processes. Most internal auditors follow high-level standards established by their professional organization, the Institute of Internal Auditors (IIA; www.theiia.org), but there are many other different ...