International Professional Practices Framework – Overview of the current guidance of the Institute of Internal Auditors

Around ten years ago the Institute of Internal Auditors (IIA) recognised the need to align the Professional Practices Framework (PPF) of Internal Auditing. In the meantime the Internal Audit has gained in importance due to different legislative and regulatory initiatives aimed at improving the Governance, Risk Management and Internal Control of an organization. The PPF has established itself as the structural basis for the activities of the Internal Audit. It is a self-contained framework which is recognized internationally by various regulatory authorities. For example, in Switzerland the Swiss Financial Market Supervisory Authority (FINMA) refers to the guidance of the IIA. As a consequence, the Internal Audit profession faced higher expectations and new challenges, which increased the need for rules and guidelines for Internal Auditing. The IIA met these needs by changing the PPF and creating additional requirements, however, the development and mandatory nature of these were not always understood.
With this background the IIA created a task force in 2006 to revise the scope and structure of the PPF and the process for developing and reviewing the individual elements of the framework. The aim of this review was to create more clarity as to the mandatory nature of the elements, to improve transparency in relation to the development of the elements, and to ensure the elements are updated quickly in a predefined development and review process. The framework proposed by the task force was approved by the IIA summer 2007. In order to emphasize the international focus of the framework, it was renamed as the International Professional Practices Framework (IPPF). The process was completed and became effective as off in January 2009. At first sight the changes appear to be of rather subordinate character, however the IPPF contains some important changes which are explained in this article. First, the individual elements of the framework are described, then, the important changes to the Standards are introduced and finally, the conclusion evaluates the changed framework and gives an outlook for the future development of the IPPF