Organizations’ Audit Committees Must Rise To the Challenges of the ‘New Normal’

IIA, IFAC Issue Joint Call to Action for Addressing Risks More Comprehensively

Jul 08, 2020 | Washington D.C. / New York | English

As organizations confront the immediate and longer-term implications of COVID-19, The Institute of Internal Auditors (IIA) and the International Federation of Accountants (IFAC) today issued a call to action for audit committees to ensure objective oversight of organizational activities, including risk management, performance, controls, and key processes.

The IIA and IFAC have developed specific recommendations for organizations to more vigorously confront uncertainties and turmoil that may threaten their integrity, transparency, and accountability.

“We must be aggressive and future-oriented in prioritizing and managing new threats and vulnerabilities, while not being distracted from existing risks,” said IIA President and CEO Richard F. Chambers. “Governing bodies and their audit committees, in particular, must be highly vigilant, nimble, and well engaged to ensure they as well as management and others are receiving objective assurance and insight on critical aspects of organizational activity.”

Adds IFAC CEO Kevin Dancey, “The impacts of COVID-19 on the global economy will be felt for years, if not decades. This creates long-term risks and uncertainties that organizations need to confront head-on through strong governance and internal controls. We hope these recommendations will support governing bodies and audit committees as they navigate the continuously evolving operating environment of today and tomorrow.”

The IIA and IFAC call on governing bodies and their audit committees to:

  1. Stay informed: Maintain a timely and clear understanding of the continuously-evolving operating environment and how it may impact organizational objectives and performance.
  2. Communicate and collaborate: Adopt a multi-disciplinary approach to exercising oversight of internal and external audit and reporting through dynamic communication and collaboration.
  3. Leverage available expertise: Seek qualified and reliable assurance and advice on management evaluations of, and responses to, the organization’s continuously evolving risks and risk profile. 
  4. Promote continuous improvement: Encourage innovation and change to address vulnerabilities and to build resilience, strengthening the pursuit of value creation.
  5. Think holistically: Adopt a broad perspective of the organization and its environment across both financial and nonfinancial goals, considering interconnectivity with other organizations, internal and external interdependencies, and the central importance of people.
  6. Embrace technology: Optimize the performance of the audit committee through the use of technology and flexible working practices.

The full statement is available on IFAC’s website.

About The IIA
The Institute of Internal Auditors (IIA) is the internal audit profession’s most widely recognized advocate, educator, and provider of standards, guidance, and certifications. Established in 1941, The IIA today serves more than 200,000 members from more than 190 countries and territories. The IIA’s global headquarters are in Lake Mary, Fla., with offices in Washington, D.C. For more information, visit www.theiia.org or www.globaliia.org.

About IFAC
The International Federation of Accountants (IFAC) is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of more than 175 members and associates in more than 130 countries and jurisdictions, representing more than 3 million accountants in public practice, education, government service, industry, and commerce.

 
 
 

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