The FRB released a ‘Supplement Policy Statement on the Internal Audit Function and its Outsourcing’ in January 2013 which comprises of a number of enhanced internal audit practices in the areas of risk analysis, thematic control issues, challenging management and policy, infrastructure, risk tolerance and governance and strategic objectives.
The IIA released ‘Recommendations from the Committee on Internal Audit Guidance for Financial Services’ in July 2013 which includes a number of recommendations to enhance the overall effectiveness of Internal Audit and its impact within firms operating in the financial services sector.
These recommendations are grouped under the following categories: the role and mandate of internal audit, scope and priorities of internal audit, reporting results, interaction with risk management, compliance and finance, independence and authority of internal audit, resources, quality assessment and relationships with regulators.
These international standards, and APRA’s latest prudential standards, CPS 220: Risk Management, all point to a consistent trend of a heightening of expectations by regulators globally with regard to the role of internal audit within financial institutions.
Ed Larkin, Partner with KPMG’s Internal Audit practice, has analysed the significant differences between the BIS paper and the FRB and IIA papers, and APRA’s CPS 220: Risk Management prudential standard.
Read Ed's full analysis.