Proceedings

1. ROLE AND PRACTICES OF INTERNAL AUDIT IN CORPORATE
GOVERNANCE – BACKGROUND LITERATURE
The International Standards for the Professional Practice of Internal Auditing
(Standards) issued by The Internal Auditing Standards Board of The Institute of
Internal Auditors (IIA) – last version issued in October 2008 and revised in October
2010 states in the Glossary part that the value added provided by internal audit
activity is proved “when it provides objective and relevant assurance, and contributes
to the effectiveness and efficiency of governance, risk management and control
processes” (IIA, 2011). In fact, Standard 2110 - Governance emphasized more
exactly which must be the role of internal audit in the process of corporate
governance.
Figure 1. Role of internal audit in governance – vision of IIA standards
(Source: adaptation after Standard 2110 – Governance)
Also, the previous versions of IIA internal auditing standards were emphasizing the
role and contribution of internal audit in the context of ensuring good corporate
governance. Under these circumstances, in the international speciality literature there
could be identified a lot of relevant papers and articles with relevant findings in the
highlighting of internal audit’s contribution and good practices in the corporate
governance (Baker and Owsen, 2002; Vinten, 2002; Melville, 2003; Paape et al.,
2003; KPMG, 2003; Gramling et al., 2004; Yakhou and Dorweiller, 2005; Whitley,
2005; Sarrens and De Beelde, 2006; Gramling and Hermanson, 2006; Zain and
Subramaniam, 2007; Allen, 2008; Archambeault et al., 2008; Ray, 2009; Sarrens,
2009; Arena and Azzone, 2009; Sarrens et al., 2009; Sarrens and Abdolmohammadi,
2011). Next, our intention is to summarize the most significant internal audit practices
identified in the context of corporate governance from author’s point of view, without
claiming that it’s a global and exhaustive synthesis.
Whitley (2005) highlights through his study the main steps that internal audit should
fulfil in order to provide its contribution to the corporate governance system, of which
the most important are:
• Internal audit must assist the board in the self assessment of its governance;
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