Rutherford Cross’ resident internal audit expert, Georgina Millyard, discusses why companies with internal audit requirements are increasingly bringing the function in house to save on cost whilst improving on quality.
Having an internal audit team permanently on hand that reports to the CFO, whilst still retaining its impartiality might sound like a pipe dream for many SMEs, but in reality, at Rutherford Cross we are seeing more and more of our clients bringing this essential function in house.
Whilst almost all organisations can benefit from internal audit, traditionally it has only been those very large organisations that choose to build their own internal audit teams.
Smaller companies that require internal audit have outsourced the function to the numerous professional services organisations that exist throughout the UK. Whilst these outsourced services still have a role to play, typically in very niche reviews, many businesses are discovering that having their own, responsive and fluid internal audit team makes increasingly good business sense.
In a world where data breaches, technology issues, and manufacturing scandals feel like everyday occurrences, boards are increasingly reliant on the audit function to ensure everything is being carried out the way it should be, at all times, with no margin for error. To this end, having a team in house that can respond quickly to any challenges that arise, is of significant benefit.
By bringing the internal audit function in house, organisations are taking steps to eliminate the risks associated with outsourcing, including; lack of communication, poor relationship management, lack of clarity around roles and responsibilities, and issues surrounding third party provider ethics and culture.
An internal audit team that exists as part of a company can also bring its knowledge of the organisational structure, staff, and sector into play, improving audit effectiveness and limiting disruption to the board and employees. In addition, a company looking to build its own internal audit function can to hire those with the specific skills required for its sector and business needs.
Whatever your company’s internal audit needs, it is worth considering all the options available to you, whether it be building your own internal audit function, outsourcing to a firm, or a combination of both. What is essential is that whatever mix you choose, your internal audit function must work hard to eliminate risk and provide assurance to the board.
To discuss your internal audit requirements, or your own career prospects within internal audit, contact [email protected]
