These skills have seen a dramatic increase in demand since the introduction of internal audit professionals as an occupational and the implementation of the Code of Corporate Governance. Companies in Dubai and UAE have implemented changes to their corporate governance systems, which has made it harder to hire qualified staff. In UAE, corporate governance is essential because of the emphasis on efficiency and cost savings.
It is important for UAE firms to take into account costs when allocating resources to an organization’s internal audit department. Along with actual cost assessments, implementation-based risk assessments should also be considered. These assessments provide valuable insight into areas that may require company operations and procedures adjustments. This will save you both time and money.
This article will discuss a range of resourcing models audit managers may consider when creating an internal audit function. We will also discuss the key questions that the Audit committee must ask to fulfill their duties.
The first question UAE companies should ask is:
“What should our total investments in internal audit be?”
The second question should be, “What is the total investment in an internal audit?”
The next question is, “What delivery method works best for us?”
These questions are interconnected because each will impact the other.
Many companies in Dubai and UAE have solved this problem. They have tried various options, including recruiting full-time workers (recruitment), outsourcing external providers, and consouring a mixed model.
There are many options when it comes to sourcing models. You have the option of hiring full-time employees internally or externally from other organizations, or both. Consider factors like where the company staff expertise lies, whether there are economies of scale, cost savings opportunities, and so forth when deciding which option you will use.
Regulation level: The higher the regulation, the more you’ll need an in-house function. Many countries, just like the UAE, require that banks have an in-house team to comply with central bank regulations.
In urgent situations, the startup needs to be tracked quickly. Outsourced models are preferred as they can adapt to new clients’ needs and have pre-existing methodologies and frameworks. It is important that you ask if firms that are not specialists are using their internal audit services Dubai to provide generalist internal audits.
These firms will not have the infrastructure or HR practices necessary to ensure they receive high-quality work. How much should an Internal Audit cost? Budgeting for Internal Audit costs can be as complicated as any other service budget. Listing rules, for instance, require no set amounts.
The first question you should ask is:
“How many internal auditors do we need?”
This question is important because every company is unique. Some companies need extensive coverage and strict regulation. Others have local business models that are more flexible and can deal with fewer regulations.
This framework can determine how much each Dubai entity should invest in internal audits. The results of surveys show what is happening now, not what we have seen. They overlook important factors that can impact the ability of an entity to allocate resources within its organization for audits.
To determine the budget, internal audit companies in UAE could use the A process. Do a risk assessment for each entity, and then analyze the results. What are the top risks? What should be the effort required to address them?
Who are the stakeholders according to company hierarchy/top-down approach?. Internal auditors must consider these factors to ensure a balanced budget.
When assessing budget proposals, follow these steps:
B1 – Audit communications with other departments
B2 – Assess how much work was completed by looking back at data from previous years on distribution levels and timelines.
B3 – Consider any new information that may have been discovered during this research when assigning priority to next year’s activities.
Other businesses might use a different model, such as centralization. A Dubai company may have experienced past problems that might indicate that it should increase its IT security investments. But, past events can impact future investments.
Therefore, it is hard to predict long-term spending based on retrospective analysis. It is important to look at both past and current activities before making decisions about where to allocate limited funds. Investments involving larger changes, such as new legislation, may need to be directed to an audit department depending on the severity of the changes.
There is an increasing demand for certified internal audit in Dubai specialists. This resource is available to companies in a variety of ways. The 2003 Code helps Audit firms in Dubai and other audit enthusiasts see what we lack in auditing and why it should be a priority.
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Are you looking to outsource your audit function? If yes, you could benefit from the services of a reliable and certified internal audit UAE has to offer. Call Audit Firms in Dubai for more information.
Theshani is a Senior auditor and has experience of 4+ years in providing audit assurance and advisory services to a wide range of industry clients. She continues to stay on top of ever-changing industry dynamics by continuously learning and developing expertise.