Function And Measures Of Internal Audit In Corporate Governance

Internal audit of China has undergone a qualitative leap,the field of internal audit has attracted more and more people's attention and interest.Internal audit has gradually become a crucial part of the corporate governance structure,and has become more and more important in corporate governance.Although many studies have suggested that internal audit can play a role in corporate governance,but the researches on how the internal audit play a role in corporate governance are few.So it is very important and very urgent to explore the path of internal audit's function in corporate governance.This paper departures from the concept and relationship of corporate governance and internal audit,analyses the theoretical framework of internal audit realizing the function of corporate governance,also discusses how internal audit plays a role in corporate governance through interaction with other governing bodies.The author adopts the method of normative analysis and case study,on the basis of sorting out the literature,discusses one by one of the connotations of internal audit and corporate governance.Then taking GE company as an example,describing the status of its internal audit and corporate governance.Proposing that internal audit plays an important role in corporate governance,the functions of internal audit are improving governance mechanism by evaluating and improving risk management,internal control and corporate culture,helping increase organizational value in order to achieve the strategic objectives of the organization.Through this research,the conclusions is there are five ways to realize the role of internal audit in corporate governance:(1)Through the establishment and improvement of internal audit related laws and regulations,ensuring the independent internal audit department in the organizational structure,developing objective and independent work attitude of internal auditor to ensure the independence of internal audit.(2)Improving the quality control of internal audit.(3)By setting up internal audit institutions,positioning correct of the internal audit work,given the required right to internal audit,strengthening the attention on internal audit work to clarify the nature and orientation of internal audit.(4)Through strengthening the training of internal auditors,countries to formulate relevant regulations to improve audit threshold,improving the market access mechanism to improve the professional competence of internal auditors.(5)By strengthening the construction of audit network,establishing internal audit management system,strengthening the connection between department and business department to improve the internal audit operation means.