Sasha Mills spoke on the subject of internal audit functions in banks and insurance companies, supervisory expectations and building on existing progress in that area. A good internal audit function, along with finance and risk management, supports and challenges the management of firm-wide risks which, in turn, helps to protect the organisation. Ms Mills discussed the financial crisis and why the internal audit function needed to change, the changes which the function underwent, the practicalities of a regulator’s scrutiny in this area and what a good internal audit function will look like moving forwards. This includes:
- scanning the horizon for emerging risks;
- thinking about the firm’s culture and management values;
- co-operating with regulators;
- firms being independent and able to provide challenge as well as assurance;
- having the right skills and expertise to be able to probe and challenge all areas of the firm with authority; and
- being aware of where your firm stands in relation to compliance with the financial services code.