The Role of the Internal Audit in the Workplace

Since the Sarbanes Oxley Act of 2002 (SOX), the role of internal audit in the workplace has increased significantly. The goal of internal audit (IA) departments is to "help" organizations achieve their stated objectives. A methodology is used to analyze business processes and activities, and recommended solutions are proposed to resolve organizational or procedural gaps. Company compliance is measured by IA through policies and procedures. However, internal auditors are not responsible for the execution of company activities. They advise management on how to better execute their responsibilities. IA departments have a broad scope, and their responsibilities may include activities such as operational efficiency, asset protection, reliability of financial reporting, or regulation compliance. However, there is one critical deficiency with IA departments as a whole - they are unregulated. Yes, there are a number of standards setting bodies, such as the Institute of Internal Auditors. However, standards do not replace the need for regulations.

Company paranoia initiated by the passing of SOX in 2002 has increased operational costs for companies across all industries. Internal auditor jobs continue to be in high demand even during the poor economic conditions. The original reason behind the increased focus for internal audit was the result of corporate scandals. IA departments fattened up their departmental head count under the premise of "protecting stakeholder interests." But approximately seven years after SOX has been passed, this is no longer the goal.