New Global Internal Audit Standards

On the 9th of January 2024 the new Global Internal Audit Standards (Standards) were released by the Institute of Internal Auditors (IIA). These Standards are meant to guide professional practice of internal auditing and serve as a basis for evaluating and elevating the quality of the internal audit function (IAF). As per the 9th of January 2025 these new Standards will become effective which means that in the coming months the audit function has to implement the changes in the upcoming period.

In this paper we will provide our views on how an IAF can and should implement the requirements related to two of the new Standards, the requirements to draft a strategy and a performance management methodology. Based on our experiences with audit functions we believe these may have the biggest impact and can serve as a great tool to look ahead and determine what impact you want to make as an IAF. In addition, we will provide an overview of the major changes in the new Standards.

We included our view on how the IAF should implement the requirements for the Standards 9.2 (IA strategy) and Standard 12.2 (performance management) on the next pages. An overview of other major changes between the 2017 and 2024 Standards can be found page 8 of this article.

KPMG believes the updated Standards provide a great momentum to start the conversation with your board of management to discuss the role of the audit function in the future. Specifically the added requirement on establishing an internal audit strategy requires a dialogue with the board of management to determine how the IAF supports the strategic objectives and success of the organization and aligns with the expectations of the board, senior management, and other key stakeholders.

As part of our strategic internal audit support and Quality Assurance Reviews KPMG has supported different clients in drafting and implementing an internal audit strategy. As part of these assessments a roadmap was developed with the key steps to ensure the audit function aligns with its strategy on the different pillars to determine the success of an IAF.

The ongoing support allowed the clients to enhance the quality of their audit function and ensure the deliverables match and exceed the requirements of the different stakeholders.

We have supported various IAFs in different industries with setting up their performance measurement model. As part of this support we have identified the different perspectives on which performance was to be measured (IA operating model and foundation, IA performance and IA strategy and positioning). For each perspective different KPIs were determined to ensure a holistic view on IA’s performance.

The ongoing support allowed the audit function to continuously measure the quality of their audit function on different aspects. Further it ensures that IA management can focus their efforts on the aspects that matter for the IAF.

Download our New Global Internal Audit Standards guide and discover how KPMG can support your company to implement the new global internal auditing standards.