Which of the following is the most appropriate reason for a chief audit executive to conduct an external assessment more frequently than five years?
A.
Significant changes in the organization's accounting policies or procedures would warrant timely analysis and feedback.
B.
More frequent external assessments can serve as an equivalent substitute for internal assessments.
C.
The parent organization's internal audit activity agreed to perform biennial reciprocal external assessments to provide greater assurance at a reduced cost.
D.
A change in senior management or internal audit leadership may change expectations and commitment to conformance
The frequency of external assessments for the internal audit activity (IAA) is typically every five years. However, certain circumstances may necessitate more frequent assessments.
Reasons for More Frequent Assessments:
Significant organizational changes or shifts in internal audit leadership can impact the effectiveness and alignment of the internal audit function with organizational goals.
Options Analysis:
Option A: While changes in accounting policies might warrant review, they do not specifically necessitate a more frequent external assessment.
Option B: More frequent external assessments cannot substitute for ongoing internal assessments, which are continuous and serve different purposes.
Option C: Reciprocal external assessments can be cost-effective but are not a primary reason for increased frequency.
Option D: Changes in senior management or internal audit leadership can lead to shifts in expectations and commitment to compliance, thus justifying more frequent external assessments to ensure continued alignment and conformance with standards.
Conclusion:
The most appropriate reason for a chief audit executive (CAE) to conduct an external assessment more frequently than five years is when there is a change in senior management or internal audit leadership, as this may alter expectations and commitment to conformance.
[:, Internal Audit Standards and Practice Guides ., , ]
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