There is currently considerable interest in the topic of Internal Audit. This can be seen as a manifestation of the current concern of “accountability” by those who control the use and allocation of economic resources. The business enterprise—in both the public and private sectors (to the extent to which these can be regarded in the UK as mutually exclusive!)—is seen as a potent force in our society. It influences the quality of our environment not just in the physical sense— e.g. aspects of pollution and efficient control and impact on the landscape —but also as a result of its activities in the creation and allocation of economic wealth. The quality of product, the maintenance of employment, reward for investment, labour and raw materials, are all directly influenced by decisions taken within the business enterprise. Those who direct and manage the business enterprise are seen to have onerous responsibilities to account to society for their actions and for the results of their decisions. This rapid development in perceptions of obligations of accountability is seen in some circles as one aspect of the crisis of authority. As such it is a characteristic of virtually every society— certainly every economically‐developed society. The crisis of authority and the challenge of accountability is not manifest solely in the United Kingdom, but it is from a domestic viewpoint that I want to examine some of the implications of those developments for the rapidly developing field of internal audit.
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