REGULATORS AND professional organizations such as the National Association of Corporate Directors have recently devoted considerable efforts to improve audit committee performance. As a result, audit committees are now expected to take on a larger role in identifying business risks, ensuring compliance with regulations, maintaining an adequate system of internal controls, and ensuring a high quality of financial reporting. As such, audit committee members may struggle with how to best adapt to the new responsibilities they face. This is especially true for new members who may have been appointed to the audit committee in order to comply with new requirements related to the independence and expertise of members. Additionally, many of the areas of increased emphasis for audit committees involve responsibilities that are shared with the internal audit function. Therefore, the recent changes in the role of the audit committee may have important implications for the internal auditor.
Dr. Curtis Verschoor's book, Audit Committee Briefing: Understanding the 21st Century Audit Committee and Its Governance Roles, is intended to provide a broad understanding of the role of the audit committee. Dr. Verschoor is an alumni research professor in the School of Accountancy at DePaul University in Chicago, a consulting CPA, and serves on the Institute of Internal Auditors board of research advisors.
This book does not attempt to provide detailed explanations of the responsibilities of the audit committee. Rather, it serves as a starting point" for anyone interested in obtaining information about the role of the audit committee in the ever-changing governance environment, with a particular focus on the impact of recent changes on the relationship between the audit committee and the internal auditing function.
This book has a number of excellent features. First, although much of the attention surrounding the recent changes in audit committee requirements has centered on the impact of such changes on the external auditor, this book does a very good job of discussing the important role of the internal auditing function in the governance process. Thus, the author is able to emphasize the possible impact that these recent changes may have on internal auditors and on potential new opportunities for them to add value to their audit committees.
Second, while Verschoor has focused on the impact of recent changes in audit committees on the internal auditing function...