Standard 1111-Direct communication with the board of directors
Standard 1111-Direct communication with the board of directors
Direct communication with the board of directors, which we want to address in this section.
The internal audit manager must interact and communicate directly with the board of directors.
the beginning
As a general procedure, in order to empower the internal audit manager to perform his duties,
The board of directors and senior management and the internal audit manager discuss and agree on the responsibilities, powers and expectations of the ruler, as well as the organizational position necessary for internal audit and the reporting relationships of the internal audit manager.
Typically, reporting relationships include direct reporting to the board of directors.
For further guidance, see Executive Guidance 1100 on Independence and Impartiality and Executive Guidance 1110 on Organizational Independence.
Executive considerations
If the internal audit manager has a direct reporting line to the board of directors,
The board of directors is responsible for approving the charter, general audit plan, budget and planning of internal audit resources along with performance evaluation, service compensation and recruitment/
He takes over the dismissal of the internal audit manager.
In addition, the board of directors oversees the internal audit’s ability to perform work while maintaining independence and in accordance with the internal audit charter.
Despite this relationship, as required in this standard,
The internal audit manager will have many opportunities to communicate and interact directly with the board of directors.
For example, the internal audit manager will be present at the meetings of the audit committee or the board of directors, generally on a quarterly basis;
To provide things like internal audit proposal, budget, work progress and any challenges.
In addition, the internal audit manager, in order to discuss the sensitive issues and problems faced by the internal audit or the organization,
He will have the ability to communicate with the president or any member of the board of directors.
Generally, at least once a year, a private meeting between the board of directors or the audit committee is officially established with the internal audit manager (without the presence of senior management);
To discuss such issues and problems.
Also, it is better for the internal audit manager to have face-to-face meetings or phone calls with the chairman of the audit committee periodically before the scheduled meetings or usually throughout the year.
internal audit managers who do not have direct access to the board of directors,
They can share with them the requirements of standard 1111 (as well as standards 1100 and 1110), as well as studies of the best management methods and interaction of the audit committee and the board of directors in order to establish stronger relationships and direct access.
In addition, internal audit managers in such a situation can consider written communications with the board of directors until they obtain a direct line of communication based on the requirements of this standard.