The internal audit charter under the 2024 Standards

The charter is the document most likely to fail a quality assessment, because most functions updated the date and left the substance alone. Under the 2024 Standards the charter carries more weight than it did before.

What the charter must address

• The purpose and mandate of the internal audit function, agreed with the board rather than asserted by management.
• The function's authority — including access to records, personnel and physical property.
• Organisational independence: the functional reporting line to the board or audit committee, and the administrative line, stated separately.
• The scope of internal audit services, including any assurance and advisory work.
• The CAE's responsibilities, including reporting on conformance with the Standards.
• Arrangements for quality, including internal assessment and the external quality assessment cycle.

The approval that is now expected

The charter is approved by the board, not adopted by management and noted by the board. Where an audit committee acts for the board, its approval should be minuted. A charter that cannot be traced to a board or committee resolution is difficult to defend in an assessment.

A test worth applying

Read your charter and ask whether it was written for the 2024 Standards or merely survives them. If it references the International Standards for the Professional Practice of Internal Auditing, or a three-tier conformance scale, it was written for the old framework and needs rewriting rather than amending.

Common questions

How often should the internal audit charter be reviewed?

Periodically, and whenever the mandate, reporting lines or scope change. Following the transition to the 2024 Standards a full review against the new framework is expected rather than a routine re-approval.

Who approves the internal audit charter?

The board, or the audit committee where it acts for the board. The approval should be recorded in minutes.