Emerging Markets Queries in Finance and Business Analysis of internal audit practices on FTSE 100

摘要

Internal audit is an activity of strategic importance when it comes to the management and control processes within a company, especially in the current post-crisis period. By using diverse procedures and work techniques, the internal audit function offers a comprehensive analysis and a complete overview of on-going activities-an image achieved by examining work methods used within the company, its organizational structure and its processes. Therefore, internal audit is considered to bring added value to the business and offers assurance that the internal control system is operational. As a result, internal audit also conveys transparency when linked with the company's corporate governance compliance. This paper sheds light on the practices of internal audit by observing work methods, the positioning and organizational structure and the processes regarding the internal audit function, when applied in 40 listed companies in the FTSE 100 index, London Stock Exchange. This study plans to answer key questions like "Is the internal audit function efficient in Great Britain's most important companies?" but also "How does internal audit help achieve proposed objectives?". By firstly approaching the notion of internal audit from a theoretical point of view, we've outlined its conceptual frame, as well as facts regarding its purpose, scope and organizational matters. Later, and most significantly, we investigated interna audit in practice, by trying to present our findings in a logic and coherent sequence. Hence, we've analysed internal audit practices at 40 listed companies on the London Stock Exchange Financial Times 10 index (FTSE 100). Our results are synthesized by using a predefined frame containing key aspects regarding internal audit. This study does not plan to represent a thorough investigation of aspects on the topic of internal audit practices because it is based solely on data collected from the 40 companies. Thus, our results are limited, and if we had picked different companies, our results might have been slightly altered. Either way, our conclusions confirm the fact that most companies have implemented and use a worthy internal audit function.