Page 23 - IIA MAGAZINE_March 2017_English

TO COMMENT on the article, Internal Audit Management
EMAIL the author at ayman.abdelrahim@outlook.com

BY AYMAN ABDELRAHIM

Key Value-Adding Activities 1. Learning the stakeholders’ expectations
through holding meetings and
Assurance Activities Objective Advice Activities Insight Activities interviews with them to know what the
added value means to them.
• Assuring the adequacy and • Informing and advising • Recommending
effectiveness of the internal the management. business improvement. 2. Surveying and identifying stakeholders’
control system. expectations and presenting the same
• Investigating or deterring • Identifying emerging for such stakeholders for confirmation
• Assuring the organization’s fraud. risks. and approval.
risk management processes.
• Informing and advising 3. Developing performance indicators in
• Assuring regulatory the audit committee line with expectations to achieve them.
compliance. For example, setting performance index
for each item of the agreed upon added
• Assuring the organization’s value.
governance processes.
4. Conducing periodic monitoring of
Outcomes Indicating a shift in the Internal Audit Profession the achievement of performance
indicators and identifying the causes
It is worth mentioning that the outcomes Moreover, one third of the answers were of any obstacles to the achievement of
of the questionnaire set out in the that the activity of “Identifying emerging indicators.
“Delivering on the Promise” Report risks” adds value to the organization;
indicate that the “Recommending business suggesting that the internal audit plays a 5. Reporting to the stakeholders on the
improvement” activity ranked second in role in determining the emerging risks, extent of fulfilling the performance
terms of value adding after the “Assuring and this is in contrary to what is known indicators.
the adequacy and effectiveness of the in terms of non-audit responsibility for
internal control system” activity. identifying internal risks as they are the 6. Repeating the previous steps
This is an indication that the internal audit responsibility of the management. However, periodically and at least annually.
had exceeded providing assurance in many the activity of “Informing and advising the
organizations. audit committee” came in last among the Planning for Value Adding
value-adding activities.
The value adding is not limited to
Audit Activities that Bring Most Value providing of assurance only as pointed out
in “Delivering on the Promise” Report.
Assuring the adequacy and effectiveness of the internal control system 86% Rather, it seems that the internal audit is in
need of developing a new method for the
Recommending business improvement 55% preparation of the internal audit plan. Such
method must be better than the current one
Assuring the organizations risk management processes 53% which depends on risk based audit plan in
order to focus on the activities that bring
Assuring regulatory compliance 50% most value to the organization. Moreover,
it is difficult to participate in identifying
Informing and advising the management 40% emerging risks and recommending business
improvement through traditional audit.
Identifying emerging risks 37% This must be taken into consideration when
rethinking the method of developing the
Assuring the organizations governance processes 37% internal audit plan. Having an insightful
vision by the auditor is also required for the
Investigating or deterring fraud 29% sustainability and continuity of the business
of the organization he/she is working for.
Informing and advising the audit committee 28% Summary

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Finally, the concept of value adding is
still not clear enough to facilitate the
Assurance Activities Objective Advice Activities Insight Activities realization of the role of internal audit
for the stakeholders, and to put an end to
Outcomes Indicating a shift in the Internal Audit Profession the growing responsibilities that fall on
the shoulders of internal audit, which is
The summary of the “Delivering on the of the method of measurement in order expected to do lot of things that go beyond
Promise” Report addresses the realization to measure the internal audit efficiency providing assurance on grounds that they
that the added value, form the prospective in the organization. In addition, there are are part of the value adding that must be
of the stakeholders, is different from some steps that must be followed when provided.
that realization from the prospective of determining the value that the internal
internal audit. There must be a consensus audit can add, as well as the need to align Ayman Abdelrahim
between the two parties and determination the same with the performance. The steps MQM, CIA, CCSA, CFE.
to be followed are as follows:

23 INTERNAL AUDITOR - MIDDLE EAST MARCH 2017