Mandatory Components of IPPF See Formal Recognition from Healthcare Sector
The Association of Healthcare Internal Auditors (AHIA) has formally endorsed to the Institute of Internal Auditors (IIA) the mandatory components of the International Professional Practice Framework (IPPF).
The International Professional Practice Framework provides components of authoritative guidance for internal auditors around the globe, classified as “mandatory” and “strongly recommended.”
The ‘mandatory’ components include the official Definition of Internal Auditing, the International Standards for the Professional Practice of Internal Auditing, and the Code of Ethics. On the other hand, the ‘strongly recommended’ components include Position Papers, Practice Advisories, and Practice Guides.
Having gone through “rigorous process of due diligence and approvals” from international committees, IPPF will help in keeping up efficiency, effectiveness, and professionalism in internal audit practices according to the IIA.
Lily Bi, Director of Standards and Guidance at AHIA, recognizes the “essential segment” represented by the healthcare sector in internal audit profession.
“The AHIA’s official recognition and endorsement of the IPPF is a significant step toward helping ensure healthcare internal audit practitioners adhere to the well recognized international standards for the profession,” says Bi.
The IIA and AHIA, having longstanding relationship in promoting quality internal audit around the world, both view the endorsement as a “natural progression” of their advocacy for internal audit professionalism.
“Our members work in a dynamic industry and strive to meet increasing stakeholder expectations that require a sound conceptual framework,” says AHIA Chair Mike Fabrizius, who sees the changing landscape of healthcare as both a challenge and an opportunity for internal audit practitioners.
On November 2010, the International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) have also proposed changes to the accounting standards that covered healthcare services, among others.
The two regulatory bodies proposed the inclusion of leases when reporting balance sheets.
According to Elizabeth Schoonees, capital markets director at PwC, companies must take a closer look at these changes to be fully aware of their effects on business financial services, particularly in “financial performance ratios, debt covenants and accounting systems.”
These proposed changes in accounting standard do not only require leases to be reported on balance sheet but also a higher frequency of gathering information and making decisions.
Other sectors covered by the proposal include the real estate, telecommunications, logistics, retail, and professional services.