INCREASING IMPORTANCE OF INTERNAL AUDITORS IN TODAY'S WORLD

• NCJ Number: 66117
• Journal: GAO Review Volume: 12 Issue: 4 Dated: (FALL 1977) Pages: 1-10
• Author(s): E B STAATS
• Date Published: 1977
• Length: 10 pages
• Corporate Author: US Government Accountability Office
• Sale Source: NCJRS Photocopy Services
• Language: English
• Country: United States of America

Annotation

THE IMPORTANCE OF THE INTERAL AUDITOR'S ROLE IN GOVERNMENT IS DISCUSSED, AND THE TRAINING NEEDED TO EXPAND THE AUDITOR'S WORK INTO THE EVALUATION OF OPERATIONS EFFECTIVENESS IS DESCRIBED.

Abstract

THE NEED FOR INTERNAL AUDITORS INCREASES WITH THE COMPLEXITY AND VOLUME OF GOVERNMENTAL AND BUSINESS OPERATIONS. AS THE COMPLEXITY AND VOLUME OF WORK INCREASES, IT BECOMES MORE DIFFICULT FOR MANAGERS TO CONTROL THE NATURE AND IMPACT OF OPERATIONS. THE CONTROL PROBLEM IS COMPOUNDED BY THE DIFFICULTY OF OBTAINING ACCURATE INFORMATION UPON WHICH MANAGEMENT DECISIONS CAN BE BASED. INTERNAL AUDITORS ARE THE PRIMARY SOURCE FOR THE INFORMATION NEEDED BY MANAGEMENT IN DECISIONMAKING. FEDERAL GOVERNMENT AUDITORS ARE RESPONSIBLE NOT ONLY FOR PROVIDING ACCURATE INFORMATION ON FINANCIAL TRANSACTIONS, BUT ALSO MAKE RECOMMENDATIONS CONCERNING HOW AN OPERATION MAY BE CONDUCTED MORE EFFICIENTLY. MUCH OF THE AUDITING OF FEDERAL OPERATIONS ALSO INVOLVES ASSESSING THE EFFECTIVENESS OF GOVERNMENT PROGRAMS IN ACHIEVING THEIR OBJECTIVES. THIS LATTER RESPONSIBILITY IS A RELATIVELY NEW ARENA FOR AUDITORS, SUCH THAT THE SKILLS AND TRAINING REQUIRED FOR EFFECTIVE EVALUATIONS ARE NOT TYPICALLY TAUGHT IN THE ACADEMIC TRAINING OF AUDITORS. EVALUATIVE WORK REQUIRES A MIXTURE OF MATHEMATICAL, STATISTICAL, ACTUARIAL, ENGINEERING, AND DATA PROCESSING SKILLS. THE MULTIPLICITY OF SKILLS REQUIRED TO CONDUCT A THOROUGH AND COMPREHENSIVE AUDIT SUGGESTS NOT ONLY ADDITIONAL TRAINING, BUT THE USE OF AUDITING TEAMS WITH MEMBERS REPRESENTING VARIOUS SPECIALTIES. SINCE MUCH OF THE VALUE OF AUDITS DEPENDS UPON THE INFORMATION BEING COMMUNICATED TO MANAGEMENT PERSONNEL, INNOVATIVE REPORTING TECHNIQUES ARE REQUIRED, INCLUDING MORE BRIEFINGS, VIDEO TAPES, AND GREATER USE OF PHOTOGRAPHS, WHERE APPROPRIATE. THE SPEED WITH WHICH TRANSACTIONS OCCUR ALSO DEMANDS THAT AUDITORS TAKE TASKS THAT HAVE TRADITIONALLY BEEN PERFORMED SEQUENTIALLY AND CONDUCT THEM SIMULTANEOUSLY. (RCB)