Chief Audit Executive (CAE)
What does CAE stand for?
The term CAE stands for Chief Audit Executive.
What is a Chief Audit Executive (CAE)?
According to the Institute of Internal Auditors, a chief audit executive is someone with professional certifications and qualifications who manages internal audit activity in a way that reflects the contents of the International Professional Practices Framework. It is important to note that a chief audit executive is not only characterized by their education, qualifications, and certifications. They are distinguished by their character and skill set. A chief audit executive is someone with a great moral mentality and a strong objective viewpoint. For any internal audit activity to be successful, it is important that the chief audit executive have these traits. In addition, a chief audit executive must possess a certain skill set in order to adequately manage internal audit activity. Such skills include the following:
- Organizational skills
- Technical skills
- Compliance skills
- Personal skills
- Planning skills
- Critical thinking skills
- Risk management skills
- Interpersonal skills
- Leadership skills
What does a Chief Audit Executive (CAE) do?
There are many jobs that a chief audit executive must perform, and it often varies from organization to organization. While some organizations prefer to share a business relationship with the chief audit executive, other organizations simply prefer the chief audit executive to act as a watchdog. To broadly cover the job description, it would be best to say that the chief audit executive is responsible for managing the internal audit activity of an organization. In other words, they are responsible for the execution of internal audit activity. How exactly do chief audit executives do that? Well, there are a number of ways. According to the Institute of Internal Auditors, some of these ways include:
- Managing internal audit activity in a way that benefits the value of the organization
- Discovering internal audit activity priorities by creating risk-based plans
- Creating a program that deals with every aspect of an organization’s internal audit activity
- Communicating internal audit activity plans to the governing body and senior management
- Communicating limitations of the internal audit activity resources to the governing body and senior management
- Finding resources that provide skills, knowledge, and other necessary requirements for internal audit activities
- Creating new procedures and policies for conducting internal audit activities
- Verifying that internal audit resources are adequate and effective concerning an approved plan
- Managing access to engagement records
- Communicating internal audit activity purpose, function, and performance for a given plan to the governing body and senior management
- Ensuring compliance of internal audit activity with the Institute of Internal Auditor Code of Ethics and Internal Audit Standards
- Creating systems that track results that are communicated to management
As you can see, a chief audit executive is responsible for many tasks. The main takeaway is chief audit executives will review, manage, and execute internal audit activity for organizations in a way that is compliant with the International Professional Practices Framework.
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