By: Hazim Selim

Edited by: Ayman Abd El Rahim

Stickmen Compass Decision

The title may seem weird or shocking at first glance. Recently, there are many discussions about how internal audit could meet the expectation of stakeholders. This subject was discussed from all aspects in many articles, studies, workshops, researches and publications. Moreover, various questionnaires were developed to measure the satisfaction of stakeholders with the performance of internal audit and its role in achieving the objectives of the organization, improving its operations and enhancing the control and risk management practices.

But on the other hand, these studies, articles and researches did not address the subject from the other party perspective with the same degree of interest, how can stakeholders meet the  expectations of internal audit and achieve the level of maturity required to understand the role of internal audit.

Wrong impression about the role of internal audit

The continuous and ongoing discussion of how internal audit meets the expectation of stakeholders may give a wrong impression about the internal audit in comparison with other units within the organization. This wrong impression is resulting from the need of internal audit to continuously justify the reasons for its existence and the importance of its work to achieve the same objectives as other organizational units as if these units seek to achieve aspirations and objectives that are not recognized or matched by the internal audit efforts.  In addition, some of these units may consider the internal audit efforts as obstacles to their work, which may impact stakeholders and thus affect the level of stakeholders’ satisfaction of internal audit work.

Tips to improve stakeholders’ maturity

In fact, the role of internal audit in large organizations is just as important as, if not more important than, that of other organizational units. Because its role is primarily related to improving the operations and enhancing the internal control, risk management and governance practices that governs the operations and management of these units.  Therefore, considering its role as inferior reflects the lack of accurate understanding of this role. Below are some tips to improve stakeholders’ maturity for understanding the vital role of internal audit:

  • Periodically clarify the role of internal audit and demonstrate its importance in complementing the role of other organizational units toward improving operations and support the internal control system, risk management and governance.
  • Promoting the work and efforts of internal audit by continuously introducing the internal auditing approach and confirming that internal audit activities are carried out in accordance with standards, procedures and scientific methods. Further, emphasize the independence of its role from the rest of other units within the organization by providing objective recommendations, which contributes to strengthening control and risk management and helps to achieve objectives of organization.
  • Conducting periodic workshops for top management to increase the level of knowledge maturity of internal audit work and its importance and urge them to transfer the knowledge and experience gained from these workshops to other managerial levels. Further, emphasize that  joint cooperation between internal audit and other units will bear fruit and benefit the organization and enhance its reputation.
  • Raising awareness of role of internal audit in the event of any fundamental changes that lead to change in stakeholder members.
  • Demonstrating the importance of engaging the internal audit in providing consultations that contribute to support the role of organizational units. This will ultimately results in exchanging experiences and improve the level of work. Hence, we find nothing to prevent presence of internal audit as observers in the committees and different teams, targeting specific tasks, without prejudice to the independence and objectivity.

This is part of a whole, the subject has more implications , and it may need many articles and ideas in order to be addressed from different perspectives.  However, at the end, if we realize that there is one goal with one common interest and that there is one team, not two, each performs its role in a different way, that would contribute significantly in harmonizing the work performance, increase effectiveness of internal audit and achieve stakeholders’ satisfaction.