The standing of internal auditing in South African national government departments

Abstract

South Africa’s successive corporate governance codes have progressively increased their emphasis on internal auditing. This article had two aims, both resulting in specific contributions to the internal auditing literature in South Africa. Firstly, it aimed to provide a comprehensive overview of factors that could affect internal audit standing, based on the references to internal auditing in the King report on governance for South Africa 2009 (King III). Secondly, questionnaire data collected from relevant stakeholders were aligned with the review of the internal audit function standing obtained from King III in a comparative analysis of the standing of the internal audit functions of national government departments. The main finding of this article is that internal auditing in government departments lacks the standing that is envisaged in King III. Regular communication between chairpersons of audit committees (CACs), accounting officers (AOs) and the heads of internal auditing (CAEs) of each department should clarify the role that internal audit functions are expected to fulfil using the resources available. The agreed role should be reflected in the internal audit charter of each department. The National Treasury should play a prominent role in evaluating the reasonable nature of and compliance with government departments’ internal audit charters.