Analysis of statutory instruments regulating the internal audit in the Russian Federation and former USSR countries
Subject Active development of internal audit in various sectors of financial and economic activity makes significant the issue of its statutory regulation. Objectives The objective is to study effective laws and regulations on internal audit in the Russian Federation and the former USSR countries. Methods Using the method of comparative analysis, we studied the laws and regulations of three FSU countries, identified similarities and differences, and assessed various provisions of the laws. We also performed a comparative analysis of federal laws on specific areas of financial and economic activities and individual economic entities operating in the Russian public sector. Results The findings show that there are basic areas, which are reflected in effective laws and regulations on internal audit. They include the definition of the internal audit concept, eligibility requirements for internal auditors, organizational subordination of structural units of the internal audit. We identified major areas of improving the laws and regulations. These recommendations may be useful for elaborating a statutory instrument, which will regulate only the internal audit sphere. Conclusions We conclude that to develop the internal audit as a fully functional activity, it is crucial to have proper statutory regulation. Otherwise, a large number of laws and regulations may appear in certain sectors of financial and economic activities, where some provisions may be duplicated, and basic aspects may differ (e.g., the definition of the substance of internal audit, eligibility requirements for internal auditors, etc.). It is also possible to ratify the International Standards for the Professional Practice of Internal Audit to develop professional activities.