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Sourcing Options for Internal Audit Services


Today’s business environment requires internal auditors to fill many different roles and responsibilities for an organization. For the internal audit function to meet the expectations of stakeholders and oversight bodies, they need a broad range of skills and ability to provide the most effective and comprehensive service. In fact, the internal audit function is increasingly moving beyond just the compliance role to becoming an advisor to the business and an example of leading practices.

Internal audit activities should be strategically aligned with overall organizational goals and should help improve operations by evaluating and improving the effectiveness of risk management, control and governance processes. To achieve these goals, the internal audit function needs to have the right technology, tools and personnel, as well as an evolving arsenal of skills, techniques and leading practices. For these reasons, effective internal audit functions often require a diversity of skills that organizations find difficult to source and retain.

Traditionally, internal audit has relied on internal resources. However, many internal audit functions are considering co-sourcing or outsourcing models given recent resource constraints in the profession, as well as the need for various skill sets such as consulting, data analysis, fraud and forensics, IT audit and cybersecurity. Co-sourcing and outsourcing are two options available for organizations to strengthen and widen their expertise while maintaining world-class internal audit resources.


When using a co-sourcing strategy, a blend of resources within an organization and a third-party service provider collaborate to execute the internal audit function. Resources are provided based on the organization’s needs in order to achieve the strategic objectives of the internal audit function.

Co-sourcing can allow your business to tap into specific skills, industry knowledge and resources on an “as needed” basis. It also allows the functional control of the internal audit function to remain in-house. This helps eliminate certain recruiting, training and employment costs and allows management to focus on its core competencies.


In the fully outsourced internal audit service model, resources are provided entirely by a third-party service provider to an organization in order to achieve the internal audit objectives. The greatest benefit to this approach is that the service provider is entirely responsible for the day-to-day internal audit function and execution. The service provider bears the investment in training, tools and technology required. Management direction is still required, but on a limited basis. This approach also provides significant cost and skill set flexibility while allowing the organization to control the risk assessment and audit plan.

As with most strategies, there is no one uniform approach that fits every organization’s requirements. Working with experienced internal audit professionals on a strategic performance review can help align your internal audit function’s objectives with key processes by considering overall risk management, compliance monitoring and performance to perform and operate more effectively.

View our internal audit sourcing infographic here.

To discuss how to enhance the value of your internal audit or for more information on our comprehensive advisory services, contact Ron Steinkamp, Advisory Services Partner, at 314.983.1238 or


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