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Setting Up an Internal Audit Function
Build an internal audit function that fits your risks, your size and your board, with a charter, methodology and risk-based plan aligned to the Global Internal Audit Standards.
- Best for
- Organisations without a working audit function
- You get
- A board-approved charter, methodology and first audit plan
- Outcome
- A function your audit committee can rely on
- Resourcing models
- In-house, outsourced or co-sourced
Overview
What is an internal audit function set-up?
Internal audit is an independent, objective assurance and advisory activity that helps an organisation achieve its objectives by evaluating and improving governance, risk management and control. Setting up the function means defining its mandate, how it stays independent, how it is resourced, and how it plans, performs and reports its work.
A well-designed function gives the board a reliable line of sight over risk, gives management practical recommendations, and meets the expectations of regulators, funders, lenders and investors. Getting the foundations right at the start is far cheaper than rebuilding a function that has lost credibility.
What it stands for
Who it’s for
When internal audit needs to start working properly
Growing organisations reach a point where the board needs independent assurance it can rely on. Others have a function that exists on paper but adds little value. Either way, the foundations decide whether internal audit earns the board’s trust.
- Organisations setting up internal audit for the first time
- Newly formed audit committees that need a working function
- Existing functions that need rebuilding after change or a poor review
- Organisations preparing for investment, listing or regulatory scrutiny
How it works
Four stages from first conversation to first audit
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Stage 1
Diagnose
We interview board members, executives and key risk owners, and review your strategy, risk register and existing assurance to understand what the function must cover.
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Stage 2
Design
We agree the mandate, independence and reporting lines, the resourcing model (in-house, outsourced or co-sourced) and the audit universe.
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Stage 3
Document
We write the charter, audit committee terms of reference, methodology manual and templates, and build your first risk-based internal audit plan.
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Stage 4
Launch
We present to the audit committee for approval and support your team, or deliver the first audits, so the function starts strong.
Strong foundations decide whether internal audit earns the board’s trust.
What you receive
A complete, ready-to-run function
Every deliverable is tailored to your organisation and written for the people who will use it.
Internal audit charter
Mandate, authority, independence and scope.
Audit committee terms of reference
Roles, responsibilities and reporting.
Audit universe
Every auditable area, linked to your risks.
Risk-based audit plan
Priorities, timing and resources for the year.
Methodology manual
Planning, fieldwork, reporting and follow-up.
Templates and QAIP
Working papers, reports and a quality programme.
Benefits
The value we add
Board confidence
Independent assurance your audit committee can rely on when it reviews risk and control.
Focus on real risks
A risk-based plan directs effort to the areas most likely to cause loss or failure.
Right-sized cost
A resourcing model matched to your size, avoiding an over-built or under-powered function.
Standards-ready from day one
Documentation built to the Global Internal Audit Standards, ready for future quality assessment.
A faster start
Ready-to-use methodology and templates mean audits can begin within weeks, not months.
Stakeholder credibility
Demonstrates good governance to investors, lenders, regulators and funders.
Senior-led
Delivered by chartered and certified professionals (ACA, ACCA, CIA).
Fixed fee
Scope and price agreed in writing before work starts.
Standards-aligned
Methodology aligned to the IIA Global Internal Audit Standards.
Frequently asked questions
Internal Audit Function Set-Up: your questions
How much does it cost to set up an internal audit function?
It depends on your size, complexity and whether we also deliver the first audits. After a free scoping call we agree a fixed fee in writing.
How long does it take to set up an internal audit function?
It depends on your size and complexity. We confirm a timeline in our proposal after the discovery call.
Do we need to hire an in-house team?
Not necessarily. Many organisations run internal audit fully outsourced or co-sourced. We help you choose the model that fits your budget and risk profile.
Will the function conform to the Global Internal Audit Standards?
Yes. The charter, methodology and quality programme are built around the IIA Global Internal Audit Standards, so the function is ready for a future External Quality Assessment.
Can you deliver the first year of audits too?
Yes. Many clients ask us to run the first plan as an outsourced or co-sourced provider while their own capability builds.
Page last updated 3 November 2026
Internal Audit Function Set-Up by sector
- Corporates & listed companies
- Private & family-owned businesses
- Public sector & local government
- Housing associations
- Education
- Charities & not-for-profit
- Healthcare & primary care
- Construction, real estate & energy
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How to set up an internal audit function: a step-by-step guide
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Ready to build your audit function?
Book a free 20-minute call to talk through your situation.