Should Internal Audit Be Responsible for Detecting Fraud?
Internal auditors love fraud: detecting it and investigating it.
The majority of boards and top management expect internal
auditors to dedicate a fair portion of their time to auditing
for fraud and performing investigations as needed.  But should
the internal audit department be responsible for detecting
fraud? Should they allocate a large portion of their audit
resources to engagements that focus on the risk of fraud or
theft?   While I fully support internal audit involvement in
investigating potential fraud, I would like to suggest that
organizations need to rethink the role of internal audit in
detecting fraud.  Management should be responsible for the
system of internal controls, including the ability to prevent
and, as necessary, detect potential theft and fraud. Internal
audit should only take on any part of this management
responsibility with the prior and formal approval of the audit
committee. In such cases, the responsibility of internal