A proposed code for internal auditors has been praised by ACCA (the Association of Chartered Certified Accountants) for 'clearly and concisely reflecting and adopting global standards', while maintaining its relevance for the UK profession.

Responding to a public consultation, issued by the Chartered Institute of Internal Auditors, ACCA welcomes the way the draft looks across the whole of an organisation’s operations to include all connectivity and interdependencies such as organisational culture, and capital and liquidity risks.

However ACCA – who has many members working in internal audit in the UK and across the globe – has raised some concerns over the combined Internal Audit Code of Practice for effective internal audit in the financial services, private and third sector.

The code has an outcomes-based approach, however, ACCA maintains its should explicitly signpost internal audit to focus on corporate strategic outcomes, what may prevent success and how successfully the organisation manages and mitigates those risks.

ACCA is concerned about the lack of focus on third party internal audit functions and how the role of a third-party function may differ. The expectation in the Code is that all internal heads are employed directly, this is not always the case.

Commenting on this, ACCA director of policy and insights, Mike Suffield, said: "ACCA recommends additional research into the success of the non-financial services code. Beyond the financial services sector there is a lack of evidence of chief internal auditors attending executive meetings and being assimilated into the C-suite."

Under the revised Code, risk assessment covering ESG, financial crime and technology will require additional expertise which may be difficult to find at a time of skills shortages.

ACCA regional lead of policy and insights, Jessica Bingham, further said: "ACCA is concerned about how such an ambition code will be delivered. Skills, talent and retention issues are impacting the finance profession as a whole and this should be a consideration for the internal audit profession."

ACCA – whose response reflects the views of its stakeholders – also suggests the draft code is clarified on the issue of proportionality and the risk-based approach with the specific aim of helping organisations with smaller internal audit functions.

"ACCA: Updated internal audit code aligns to global standards" was originally created and published by The Accountant, a GlobalData owned brand.

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