| The main purpose of this paper is to analyze the feasibility and rationality of internal audit outsourcing based on Economics and real work and what kind of changes are going to take place on China' s internal audit to meet the needs of fast changing economic environment. At the end of the paper, the prospects of internal audit outsourcing are developed on four aspects.The paper is composed of five chapters. Because the nature of internal audit is to provide service for the board and manager of the company, the functions, status and content of internal audit are changing continuously to meet the needs of management. In Chapter One, the functions, status and content of internal audit are defined to forward that there is real needs in real work for internal audit outsourcing. In Chapter Two, the phenomenon of internal audit outsourcing is explained based on Economics. When the total cost of the enterprise can be reduced through the internal audit outsourcing, it' s reasonably deduced that outsourcing is possible. In Chapter Three, the feasibility and rationality of external audit acted as internal audit is analyzed, which is proved by an example of fraud audit both in America and China. A conclusion is made that there are similarities of internal audit and external audit on the methods and procedures while proceeding fraud audit. Therefore, it' s possible for external audit to act as internal audit. In Chapter Four, due to the debate on whether outsourcing or not, an analysis on the superiority and the inferior position is developed to conclude that outsourcing doesn't mean internal audit is denied completely. Contrarily the cooperation of internal auditor and external auditor on internal audit is a trend. In Chapter Five, to meet the needs of new economy, internal audit in China has to adjust under the orientation of market. In the end, ideas about the future of outsourcing are forwarded. |
