STRONGLY RECOMMENDED GUIDANCE

The IIAs mandatory guidance is relatively general in nature because it is applicable to all
internal audit activities. Internal audit assurance and consulting enggagements are
conducted in a wide variety of organizations, by in-house internal audit functions or outside
service providers, in a centralized or decentralized organizational structure, and in diverse
cultures and legal environments.
Strongly recommended guidance (Practice Advisories, Position Papers, and Practice Guides)
provide more specific, nonmandotory guidance. In some cases, strongly recommended
guidance may not be applicable to all internal audit functions. In other case, it may
represent only one of many acceptable alternatives.
Practice Advisories
The practice advisories provide concise and timely guidance as to how the Standards might
be implemented. They address approaches, methodologies, and factors for an internal audit
function to consider, but are not intended to provide detailed processes and procedures for
internal audit functions to follow. They may pertain to specific types of enggagements or
clarify geographical or industry internal audit practices. Each practice advisory is correlated
by number to the standard to whitc it pertains and also refers to the Code of Ethics where
applicable.

Position Papers
Posisition papers provide guidance on issues that extend beyond the specifics of how the
CAE, internal audit function, and individual internal auditors should conduct their work.
They are written not only for internal auditors but for other interestes parties outside the
proffesion. Such parties include management, board and audit committee members, and
external stakeholders such as legislators, regulators, and other professionals whit whom
internal auditors work. Position papers currently address the role of internal auditing in the
organizations enterprise risk management system and how organization sources the
internal audit function. Future position papers may address significant governance, risk
management, and control issues with the intent of clarifying the issues and enhacing
internal auditors and stakeholders understanding of the issues.
Practice Guides
Practice Guides provide detailed guidance on internal audit tools and techniques. Practices
guides are currently composed of the Global Technology Audit Guides (GTAG) and the Guide
to the Assesment of IT Risk (GAIT) series, both of which were developed by The IIAs
Advanced Technology Committee.

HOW THE INTERNATIONAL PROFFESIONAL PRACTICES
FRAMEWORK IS KEPT CURRENT
The Proffesional Practices Advisory Council is responsible for coordinating the initiation,
development, issuance, and maintenance of the authoritative guidance that makes up the
IPPF. The Council omprises The IIAs vice president of professional practices and the cairs of
the IIAs six international technical committees. These comittees are the Ethics Committee,
the Internal Audit Standards Board, the Professional Issues Committee, thmittee Advanced
Technology Committee, the Committee on Quality, and the Board of Regents. The first three
committees have direct responsibility for maintaining spcific portions of the IPPF.
Each year, the Professional Practices Advisory Council develops a work plan for the next
year as well as a tentative plan for the following two years that lays out the work for the
Ethics Committee, the Internal Audit Standards Board, and the professional Issues
Committee. The Council also coordinates the review of all existing guidance on a three year
cycle.

The Ethics Committe.
The Ethics Committees mission is to serve the global profession of internal auditing by
maintaining the IIAs Code of Ethics; promoting and understanding of and compliance with
the IIAs Code of Ethics; assessing, investigatin, and sanctioning complaints concerning
noncompliance with The IIAs Code of Ethics; and advocating ethics as part of the
governance process.

The Internal Audit Standards Board
The internal audits standards boards mission is to promulgate, monitor, and promote the
Standards on a worldwide basis. The board is required to complete a review of the existing
Standards every three years. New standards or modifications to existing standards are
initiated with the committee and require a 90 day exposure period for public comment.

Professional Issues Committee
The professional Issues Commitees mission is to provide thought leadership and timely
professional guidance to the members and stakeholders of the internal audit profession on
methodologies, techniques, and authoritative positions included in the IPPF and to coment
on or support other matters that impact the internal audit profession. This comitee initiates,
develops, and maintains the practive advisoriesand reviews existing practice advisories on a
three-year cycle. The professional Issues also is a primary initiator and developer of Position
Papers and Practice Guides.

THE IPPF GUIDANCE DEVELOPMENT PROCESS
IPPF
Element/Resposibility
Process Final Approval
The Definition
Board of directors
estabilishes special task
force:
- 90-day public
exposure period
IIA Board of Directors
Code of Ethics
Ethics Committee Developed and maintained
by Ethics Cmmittee:
- 90-day public
exposure period
IIA Board of Directors
International Standards for the Professional Practice of Internal Auditing
Internal Audit Standards
Board
Developed and maintained
by the Internal Audit
Standards Board:
- 90-day public
exposure period
International Audit
Standards Board
Practice Advisories
Professional Issues
Committee
Developed and maintained
by the Professional issus
committee:
- Drafts reviewed by
ethics committee and
standards board for
consitency.
No additional exposure
Professional Issues
Committee
Position Papers
Professional Issues
Committee
Professional Issues
Committee primary
developer but can be
initiated by local IIA
IIA Executive Committee



institutes istitutes or other
IIA committees :
- Drafts reviewed by
ethics committee and
standards board for
consistency.
- 30-day exposure
period to local IIA
- institutes
Practice Guides
Professional Practices
Council
Professional Practices
Council responsible for
development, approval, and
maintenance:
- council assigns
development of
guide to an
international
technical committee.
- Drafts reviewed by
Ethics Committee
and Standards Board
for consistency
- No additional
exposure
Professional Practices
Council

STANDARDS PROMULGATED BY OTHER
ORGANIZATIONS
The IIA recognizes that guidance promulgated by other organizations is pertinent to the
profession of internal auditing. In fact, some internal audit functions need to follow other
professional guidance in addition to the IPPF. Such guidance includes, for instance, the U.S
Government Account ability Offices (GAOs) Governmental Auditing Standards, Standards
for the Professional Practice of Enviromental, Health, and Safety Auditing, and standards
issued by the International Standards Organization (ISO).

Standards for Internal Auditing in Government
The GAO has issued standards gor governmental audits in the United States. These
standards are commonly referred to as the Yellow Book standards because of the yellow
cover used when publishing the standards. The Yellow Book standards apply to US. Federal
financial audits, performance (or operational) audits, and other audit-related activities.


Standards for Information Technology Audits
Auditing computerized information system is integral to internal auditing. While the IIAs
standards provide a sufficient framework for auditing computerized system, ISACA
(previously know as the Information System Audit and Control Association) provides more
detailed and specialized guidance.

Standards for the Professional Practice of Environmental, Health, and Safety Auditing
The Board of Environmental, Health, and Safety Auditor Certifications (BEAC) has developed
Standards for The Professional Practice of Environmental, helath, and Safety Auditing to
address the needs of environmental, helath, and safety audit professionals. When internal
audit functions perform environmental, helath, and safety audit engagements they can use
the BEAC Standards to direct their work.

Standards for Financial Audits
The US Public Company Accounting Oversight Board (PCAOB) and the American Institute of
Certified Public Accountants (AICPA) currently set the standards for audit of companies
financial statements in the United States. Standards for audit of companies financial
statements are set separately in other countries as well. However, as is the case with
accounting standards, there are initiatives under way to unify the financial audit standards
among certain contries.

Other Relevant Guidance
Guidance promugulated by other professional organizations also is relevant also is relevant
to internal auditors. For example :
- The International Standards Organizations (ISO) set standards for quality and
environmental audits.
- Standards Australia promulgates standards for risk management and governance
processes
- The Committee of Sponsoring Organizations of the Treadway Commission(COSO)
has issued four framework pertaining specifically to interna control and risk
management.
These are just a few of the many organizations that promulgate guidance of relevance to
internal auditors. Internal auditors must be cognizant of these organizations and the nature
of the guidance they issue. Internal auditors practicing in specific countries or in certain
industries must be knowledgeable of existing guidance, other than The IIAS IPPF, that is
relevant to their work.

SUMMARY
This chapter covered in detail The IIAs IPFF. This framework contains two categories of
authoritative guidance mandatory and strongly recommended that enable internal audit
functions provide value adding assurance and consulting services. Mandatory guidance
includes the Definitions of Internal Auditing, the Code of Ethics, and the Standards. Strongly
recommended guidance includes Practice Advisoies, Position Papers, and Practice Guides.
The process through which The IIA maintains and develops the IPPF also was discussed, as
was guidance of relevance to internal auditors that is promulgated by professional
organizations other than the IIA.
The code of Ethics articulates the ethical principles and behaviroal norms relevant to the
practice attributes that internal auditing. The Attribute Standards prescribe the attributes
that internal audit functions and individual internal auditor must have to deliver assurance
and consulting services effectively. The perfomance Standards provide authritative guidance
on managing the internal audit function and conduting assurance and consulting
engagements. The implementation standard expand upon the Attribute and Perfomance
Standards by providing guidance that is speciafically applicable to either assurance services
or consuling services. Practice Advisories, Position Papers, and Practice Guides provide
guidance that is helpful to internal auditors in implementing the Definition of Internal
Auditing, Code of Ethics, and Standards. Finally, standards promulgated by other
organizations that are relevant to internal auditors were discussed.
The IPPF, espesially the Standards and Practice Advisories, will be referred to extensively
throughout the reminder of this book.