Feasibility Study On Upgrading The Strategic Objectives Of Corporate Internal Audit

In June 1999, the Institute of Internal Auditors defined internal audit , in which, it was the first time that "help to add value to the organization" was written as one of the most important objectives of internal audit. So it indicated that the internal audit's strategic objective had changed from the traditional "Checking correct disadvantages" to " help to add value to the organization". However, at present China's internal audit is also at a lower stage, and in comparison with foreign countries there is still a wide gap. Therefore, to explore ways to enhance our internal audit strategic objectives for China's listed companies is useful to improve their internal audit work, thereby improve corporate governance and the performance of the whole organization.In the paper, it introduces the principal-agent theory, corporate governance theory, internal control theory and the Balanced Scorecard theory firstly, explains the relationship between internal audit and those theories. Following it analyzes the need of upgrading the strategic goals of company's internal audit, not only from the internal audit development status, but also theoretically sums up the need to upgrade the strategic objectives. Then, it makes empirical analysis of the strategic objectives of China's internal audit, which is "help to add value to the organization". Through the study in this paper, it has found that internal audit which is under the leadership of audit committee is positively correlated to corporate value growth, but it is not significant. So there are some serious shortcomings about upgrading the strategy objectives of China's internal audit. Internal audit needs to be further strengthened, but also the need for further theoretical research, and hope to achieve the aim of improving the subsequent internal audit work.Finally, to achieve the integration of theory and practice, according to the status quo of internal audit strategic objectives, it gives recommendations proposed to upgrade the strategic objectives, hopes that through the promotion of establishing independent internal audit institution, strengthening internal audit service and system of methods, strengthening the evaluation of internal audit performance by using balanced scorecard, providing more "value-added" services, strengthening cooperation with the external audit and follow-up auditing, it will achieve the goal to upgrade the strategic objectives of internal audit.