Ernst & Young: Eighty percent of chief audit executives see room for improvement

By Rob Starr, Content Manager, Big4.com

A new global survey of 695 chief audit executives (CAEs) and C-suite executives released by Ernst & Young recently reveals that 80% of organizations acknowledge that their internal audit function has room for improvement.

In order to focus on risks that matter, create value and help the organization achieve its objectives, internal audit functions need to align their strategy to that of the overarching organizational strategy. However, 61% of respondents reported that they had no documented mandate that aligns internal audit to the organizational strategy.

The future of internal audit is now report, highlights that 75% of respondents believe strong risk management has a positive impact on their long-term earnings performance and an equal percentage believe that their internal audit function has a positive impact on their overall risk management efforts

Internal audit risk assessments, regulatory requirements and enterprise risk assessments are the top three drivers of the audit plan, and internal audit is playing a more prominent role in organizational issues, such as major capital projects (49%), IT systems implementations (42%), mergers and acquisitions (37%) and material contracts (32%). Technology also remains a key area of focus for internal audit functions, comprising 18% of the current audit plan.