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The Human Element in Auditing:
How Relationships Shape Internal
Audit Outcomes
Why are human relationships an
important component?
An Internal Auditor (‘IA’) is expected to be
independent, apply due care and diligence,
have integrity, be objective, etc., but all these
are mainly driven by the thought process. Yes,
we would have pronouncements from IIA
and other regulatory bodies thatgovern the
profession, but beyond that is self-governance.
In a workplace would the relationship with a
Aditya Kumar S colleague in whichever manner hamper the
Partner, R.G.N. PRICE & CO. basic qualities expected out of an auditor is
aditya@rgnprice.com something to think about. At times, when
equations at the personal level may not be good
for any reason, there is a risk of that spilling over
In an era where technology enhances efficiency, to the office or professional space. The human
more so in auditing, the auditor’s instincts or gut mind is unique, and how hard or how easy it
feeling, honed through training and experience,
remains invaluable. This “sixth sense” enables would be to compart mentalise the relationship
auditors to detect anomalies by connecting the dots and look at it objectively is anybody’s guess.
based on their insights and experiences. However,
human emotion scan sometimes cloud judgement
and be influenced by personal relationships with
family, friends, neighbours, or colleagues. This raises
an intriguing question: how do these relationships
affect an internal auditor’s objectivity, and could they
potentially compromise the integrity of their role?
This article attempts to look at the psychological
impact of the relationships that influence the
day-to-day work of an internal auditor (or, for
that matter, any other professional as well). IA
is always looked upto as somebody who could
guide, give advice and critically give feedback;
but when the IA is in a dilemma, when there
is a conflict in his thought due to personal
relationship…it’s what I call “Dharmasankat.”
For example, IA identifies significant
deficiencies in a particular role managed by a
staff member who also happens to be his/her
relative, friend, etc. Would there be a bias in the
decision-making? In my view, this dilemma, or
thought of taking action against a friend for the
benefit of an organisation or taking action and
losing a good friend, is Dharmasankat.
46 | INSIGHT EXCHANGE INTERNAL AUDIT TODAY
