With the Institute of Internal Auditors (IIA) requiring a mandatory External Quality Assessment Review (EQAR) every five years, how exactly are you supposed to know what type of EQAR is right for your internal audit activity and organization?
To help navigate this important question, we describe each type that you can choose, and share the advantages that may benefit you and your organization most:
1. A Self-assessment With Independent Validation
The Chief Audit Executive (CAE) oversees an internal team that conducts the overall planning and evaluation of the work program and activities regarding the IIA’s QAR requirements. A report containing a summary of the results is drafted for the key stakeholders, at which time an independent external assessor will validate and concur with the results completed by the internal team. The independent assessor can also provide process improvement opportunities identified as a result of their independent validation.
- Cost effective method of performing a QAR
- Great training tool for understanding how the Internal Audit Activity operates
- Provides opportunity for education and mentoring of the internal audit team
- Information is shared within the organization
- Acquisition of better practices knowledge from the Independent Assessor
2. A Full External Assessment
A qualified external assessor or assessment team evaluates the internal and audit activity in conformance with the professional standards of the IIA. The focus is the same as the self-assessment, but the activity and completion of the report is prepared by the external assessor and includes their opinion on the overall conformance with the IIA’s requirements.
- Internal Audit Activity time is reduced as the work is performed by the assessor
- Engagement goes beyond compliance and enables a value-added strategic focus
- Ability to leverage assessor’s depth and wealth of knowledge
- Increased ability to identify successful practices and opportunities for improvement
- Greater credibility/confidence as the review is performed by an independent third-party
- Inclusion of benchmarking and continuous improvement of vision and roadmap
3. Peer Review
As the name suggests, this review is conducted by similar organizations, either in industry or size, who have the appropriate skills, knowledge, and independence. Typically, three organizations participate. The reviews are reciprocated amongst the members, and a report is issued for each organization.
- Great experience and growth opportunity for team participants
- Ability to benchmark, specifically against a similar organization
- Lowest external cost
- Confidentiality of information is maintained between peer organizations
How MorganFranklin Can Help
We work with our clients to provide an independent validation of the Internal Audit Activity and identification of opportunities to increase effectiveness, improve processes, and enhance credibility. Our methodology is built around complete support and encompasses benchmarking, best practices, templates, and tools to meet business goals. To learn more about MorganFranklin’s QAR, contact our experts below.