City support for auditors needed

Some of the biggest City scandals could be avoided if senior management showed more support and commitment to internal auditors.

David Brilliant, chairman of the English ICA audit faculty’s internal audit task force, warned that many companies had appointed internal auditors but given their findings no credence. Because of that, he said, ‘people further down the tree have no time for internal audit either’.

The institute has published an information booklet on internal audit, the first since the audit faculty was set up in 1995. The booklet studies corporate governance issues, managing business risk and the state of internal controls in companies.

Brilliant, director of European internal audit services at Price Waterhouse, said internal audit performed an important management service.

But, he added: ‘There is heightened awareness of the importance of internal audit. But the problem in many cases has been that although internal auditors flag up issues, they have not been acted upon.

‘Internal auditors must be listened to and given an authoritative and independent status within companies, without becoming a police force.’