Magazine article The CPA Journal

Brink's Modern Internal Auditing, Fifth Edition

Magazine article The CPA Journal

Brink's Modern Internal Auditing, Fifth Edition

Article excerpt


By Robert Moeller and Herbert N. Witt

John Wiley and Sons; 1,200 pp.; $168 hardcover; ISBN: 0-471-52132-9

With his first edition in 1942, Victor Brink began pioneering the fields of professional internal auditing and operational auditing. An active practitioner for many years, his influence in these areas was profound.This fifth edition serves as a comprehensive, state-of-the-art publication.

Too often, the significant effect that the operating or nonfinancial portions of organizations can have on their income statements is unrecognized. Auditors frequently spend little or no time in reviewing, let alone understanding, these areas along with the financial implications of undesirable occurrences, including impropriety, waste, losses, and errors. This volume effectively demonstrates what auditors and accountants must be aware of in areas outside of their primary competency.

Many readers will be surprised to learn how far internal auditing has evolved and how sophisticated the function has become in many larger organizations.Today's internal auditors are generally CPAs or Certified Internal Auditors (CIA). The Institute of Internal Auditors (IIA) has become an international force in its field and has spurred extensive research that the author capably integrates in this book.

Part One, "Foundations of Internal Auditing," provides an introduction to the field and internal control. It compares external and internal auditors and indicates how the latter go beyond the financial statements to examine the policies, decisions, procedures, and performances that impact them. Operational auditing is intended to maximize any entity's performance by effectively using its resources.This thrust can and should take internal auditors into every part of the organization.

Part Two, "Administering Internal Audit Activities," explains how the internal audit function can be of greatest value to all levels of an entity. It stresses the independent nature of the function and how this is reinforced when internal auditors report to the audit committee of an organization's board of directors or trustees.

This section of the book also presents and discusses the "Standards for the Professional Practice of Internal Auditing" developed by the ILA. The evaluation of an entity's (along with the auditors') exposure to risk from loss or injury, the structuring and planning of the internal audit function, and the recruiting and development of staff are covered as well. …

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