Senior management requested that the internal audit function conduct an advisory engagement to evaluate the...

Advisory engagements are distinguished by their collaborative nature. The internal audit function and the relevant stakeholder normally agree on the engagement’s objectives, nature, and scope according to the organization’s needs. This differs from assurance work, where internal audit independently determines appropriate objectives and procedures based on identified risks and established evaluation criteria. Identifying evaluation criteria and determining required resources can occur in both assurance and advisory engagements. Likewise, providing an independent conclusion regarding the effectiveness of governance, risk management, and control is principally characteristic of assurance services. Therefore, collaborating with senior management to establish the objective and scope is the activity most specifically associated with advisory work. Internal audit must still preserve objectivity and must not assume management responsibility while providing advice.