10 Jun Gene is a new staff-level auditor on the audit of CalPower
Question
Gene is a new staff-level auditor on the audit of CalPower,
Gene is a new staff-level auditor on the audit of CalPower, a publicly traded
energy and utility company. On his first day, his senior informs him that the engagement
team is scheduled to have lunch with the internal auditor to discuss ways to
improve this year’s audit. While Gene has heard a lot about internal auditing in
school and has some friends who recently began working as internal auditors, he
is unfamiliar with exactly what internal auditors do and how internal and external
auditors can work together to improve the audit process. Gene decides to take
a look at last year’s internal audit report prepared by CalPower’s internal auditors.
He notices that the report includes a sentence that reads, “CalPower’s Internal Audit
group maintains a high level of independence from management.” Because Gene
is intimately familiar with the extensive independence requirements of his own
firm, he cannot figure out how CalPower’s internal audit group can possibly assert
their own independence.
What is meant by independence from management for internal auditors? 250-500 words
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