Boom in outsourcing of internal audit predicted
Ernst & Young has published a report predicting a boom in outsourcing of internal audit services.
The firm says the role of internal auditors is rapidly changing due to greater demands for corporate governance and closer ties between internal audit and business objectives.
Key findings of the E&Y report, ?Internal audit outsourcing: forces driving change?, show 40% of company directors interviewed see the possibility of increased outsourcing of the internal audit function as more cost effective.
Over 60% of respondents admit to difficulties when tackling IT and strategic areas of risk review and policy, according to the report.
The E&Y survey conducted by IDL Ltd was carried out between September 1999 and March 2000 and included a total 40 FTSE listed companies.
Howard Martin, business risk consulting partner and E&Y, said: ?Our clients tell us that over the next three years the internal audit function has to sit more closely with the business, not least because of the demands made by Turnbull.’
A boom in outsourcing the internal audit function would lead to increased work for accountancy firms. Ernst & Young recently gained the contract worth £2.5m a year for three years to provide internally audit services to ICI, winning the work in a tender against PricewaterhouseCoopers and Arthur Andersen.
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