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Ethics and Internal Audit Reporting independent. More than the reporting structure,
it is more to do with courage and ethical values of
Q: Ethics plays a crucial role in auditing. How an auditor and culture of an organisation. If these
do you define ethics, and how does it apply to factors are set right, transparency in reporting is an
internal audit reporting? off shoot.
A: Ethics is doing things the right way. Speaking As said earlier, the bridge between reporting and
and reporting the factual truth in a professional presenting will determine the level of transparency
manner. When an auditor has worked honestly an organisation cultivates in its DNA. An auditor
and reports results in an independent, objective can only be as transparent as the organisational
and transparent manner, I believe an auditor has elements are with him / her in the dispensation of
been ethical in performing his or her duties. his roles and responsibilities.
Reporting facts vs Presenting facts, between the Transparency is presenting the report or results as
two lies the ethical dilemma that every Audit leader it is. No adulteration.
has to traverse and provide legitimate assurance.
E.g. Statutory Compliance. All material facts, pertinent information, key
risks, root cause and action plan with way forward
The Ideal Qualities of an Internal Auditor presented to the Stakeholders to strengthen the
governance framework.
When Should an Auditor Exercise
Discretion?
Q: Are there situations where auditors should
exercise discretion in reporting?
A: Anything wherein your conscience is stopping
you from disclosing must be refrained from
reporting. Many a times there is no guideline
Q: What essential qualities do you look for in an or auditing standard required to control our
internal auditor? actions. We are mature enough to understand the
consequences of not exercising discretion.
A: Value system, technical competency,
professional qualifications and whether an auditor I always encourage professionals out there, seek
demonstrates integrity towards his or her work. advice from your senior colleagues or managers
Internal auditor must apply common sense while before sharing data or information with anyone. In
discharging duties. I look forward to professional today’s world, confidentiality of data is a given.
skepticism and a learning attitude in an auditor.
Treat everything you do, is confidential, unless
Ability to influence and drive change while there is a legal requirement to disclose.
remaining independent is a must required
competency. As far as Internal Audit Reporting goes, if there
are legal or reputational consequences to the
Transparency in Internal Audit Reporting results that you report, explore ways and means to
communicate the results to the management. The
Q: How transparent should internal audit Global Internal Audit Standards issued by Institute
reporting be? What defines transparency? of Internal auditors, as per Principle 13 and its
relevant standards mentions the engagement
A: Before speaking about transparency, I must say, communications can be formal, informal, written
lot of actions of auditor is to do with the mindset. and oral. Not disclosing is not an option.
An Auditor or Chief Audit Executive must be
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