Internal Auditors
Should I report the non-compliances
of my good friends to the management? Like any members of the company, internal auditors may have developed close friendships with colleagues. They may attend social gatherings with colleagues, e.g. karaoke, dinners, and treat each other with meals and entertainment. How should an internal auditor handle the situation if a number of non-compliances with the laws and the company's policies and procedures by these "good friends" are uncovered during an internal audit?
Should I follow the instructions of
the management to change
the audit findings? Through their work, internal auditors may identify emerging or high risk areas of concern for an organisation. Through their work, internal auditors may make a positive impact on the organisation's operations and generate improvement opportunities. Yet, such opportunities are not always welcome and internal auditors may face pushback from senior management. Some senior management may even instruct internal auditors to put the planned audit work on hold or conduct audit work on other specified areas without any justifications.
Even the most thoroughly researched and fairly presented internal audit reports can generate disagreement. It is not uncommon that internal auditors face pressure from management to suppress or alter the results of audit findings because they reflect poorly on management or some other aspects of the business. When internal auditors resist pressure to change audit findings, they sometimes face consequences, for example, being excluded from meetings for standing their ground on an audit issue, facing budget cuts and even losing their jobs.
Internal auditors should stay alert to the threats as well as understand the requirements under the Prevention of Bribery Ordinance (POBO) (Cap. 201) and other relevant legislations. The above situations may create various threats to the fundamental principles of ethics for professional accountants. 
