Reflections on the internal auditing profession: what might have gone wrong?

Abstract

Purpose

The purpose of this paper is to investigate and discuss potential reasons why the internal auditing (IA) profession has been marginalized in the governance debate on solutions after the financial crisis that started in 2007, also noting recent studies questioning the value of IA's work. The key aim of this paper is to make readers aware of ambiguities concerning the ultimate customer of IA and its core business, and to stimulate critical reflection thereon.

Design/methodology/approach

The conceptual discussion of this paper is based on an objective review of relevant literature, both practitioner and academic.

Findings

Positioning IA as agent to the board/audit committee and, at the same time, as partner to management is challenging in practice. The IA function should clarify the customer dimension in its organizational context. Furthermore, this paper argues for a consolidation of internal audit around its core function of providing assurance when seeking to establish IA as a profession.

Practical implications

Practitioners will benefit as this paper demands fundamental questions to be addressed in the organizational context, about the ultimate customer and the core business of the IA service rendered. The Institute of Internal Auditors will benefit from this paper and subsequent discussions in academia and practice, supporting its pursuit to gain universal recognition for IA as a profession.

Originality/value

This paper may open a new research area in IA that addresses a more critical way of evaluating IA practices.

Citation

Lenz, R. and Sarens, G. (2012), "Reflections on the internal auditing profession: what might have gone wrong?", Managerial Auditing Journal, Vol. 27 No. 6, pp. 532-549. https://doi.org/10.1108/02686901211236382