Ways Or How To Gauge/Assess The Effectiveness/Reliability Of An Internal Audit Department

Append below some of the ways to gauge the effectiveness or reliability of an Internal Audit Department:

Status In Organization Structure/Chart & Access/Communication To Top Level Management The level of department and the level of management to which the internal auditor reports to. Generally, the higher the level the internal auditor reports means the greater will be his independence Question to ask is whether the internal auditor is given access and can communicate to the Board of Directors/Audit Committee

Scope Of Function The nature and depth of coverage of the assignment which the internal auditor More importantly, look whether there is any sort of restrictions, if any on the scope of work/activities of the internal audit department. Are there some departments that the internal audit department cannot audit or has very weak scope in audit terms/reference? Are the internal audit objectives in congruence with the objectives of the company and are they measurable, achievable and able to communicated

Technical ,Experience & Knowledge Competence Is the internal auditor having adequate proficiency in terms of experience, knowledge or technical competency? Need to review his or her experience and professional qualification who are working in the internal audit department

Due Professional Care Ascertain whether the internal auditor work appear to be properly planned, supervised, reviewed and documented. Check/review whether there are any adequate audit manuals, audit programmes and working papers existing in the internal audit department

Follow Up Of Internal Audit Recommendations Ascertain whether the internal audit recommendations are implemented by the management, whether errors reported are corrected without delay or any remedial action taken either immediately or timeline Note that if other departmental/ operating/ line managers do not bother much of the internal audit recommendations, it would mean that it is not effective and do not have the support of top management level!