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NHS Internal Audit Standards
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Document type:Publication,Standard
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Author:Department of Health
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Published date:28 June 2002
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Primary audience:Finance,Directors,Professionals
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Publication format:Electronic only
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Gateway reference:2002
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Copyright holder:Copyright
A letter from Richard Douglas concerning the new NHS Internal Audit Standards and the new Definition of Internal Audit.
28th June 2002
To:
NHS Chief Executives
Copies:
NHS Directors of Finance
NHS Heads of Internal Audit
NHS Audit Committee Chairmen
Dear Colleagues
NHS Internal Audit Standards
I am enclosing copies of the new NHS Internal Audit Standards and would like to draw your attention to the new Definition of Internal Audit. The Standards support the professional practice of internal audit in all NHS organisations.
The Definition and Standards are effective from April 2002. They replace the Standards issued by the NHS Executive in 1995.
These new documents define the way in which all internal audit services operating within the NHS should undertake their functions with regard to assurance audits and consultancy activity.
Background
The Definition and Standards have been prepared, with the support of the Internal Audit Practitioners Group, to reflect the Government Internal Audit Standards as promulgated by HM Treasury.
Key Issues
The issue of these documents is part of the process of reflecting and defining Internal Audit's enhanced role in relation to corporate governance, risk management and assurance that has developed over recent years. The key points to note are as follows:
- Reporting lines from the Head of Internal Audit to the Accountable Officer, Designated Director (if appropriate), the Board and the Audit Committee need to be clear. This will be of particular importance given the verification and coordination role of Internal Audit in supporting the Accountable Officer in the processes leading to the preparation of the Statement on Internal Control.
- Internal Audit Strategy, Planning, Scope and Conduct of work are to be prepared and delivered from the perspective of the whole organisational system of risk management, control and governance arrangements.
- The Head of Internal Audit will need to make appropriate arrangements to form an opinion where key systems are being operated by, or on behalf of, third parties.
- The Standards also introduce a new Code of Ethics that will apply to all Internal Auditors working within the NHS.
- The Definition sets out a clear consultancy role for Internal Auditors to add value to the organisations in which they work without compromising independence and objectivity.
Next Steps
The Internal Audit Practitioners Group will be assisting the Department in the development of good practice in relation to many of the aspects of the new Standards. Priority will be given to the production of the following:
- An updated risk assessment and planning methodology;
- Guidance on the coordination of assurance functions by Internal Audit;
- A risk-based audit assignment methodology;
- A third party assurance protocol;
- A model Head of Internal Audit Statement for 2002/2003; and
- A protocol for consultancy engagements.
Action
For Heads of Internal Audit, appropriately supported by Accountable Officers, to implement the new Definition and Standards with effect from 1 April 2002.
Enquiries
Any enquiries on the standards should be addressed to David Parker, Room 4E46 Quarry House, Leeds LS2 7Ue or by email david.a.parker@doh.gsi.gov.uk, telephone 0113 254 5402.
Richard Douglas
Director of Finance
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