India has the potential to become the international back office ofinternal audit services by meeting the demands of multinational companies, saidHal Garyn, vice-president, professional practices at the Institute of Internal Auditors(IIA), a global professional grouping. 

The internal audit section (138) of the new Companies Act has brought India closer to international standards and increased the global acceptance of Indian reporting rules, he said in an interview. 

Such skills will provide the country with an export opportunity for internal auditing and related services, Garyn said. The new Companies Act, which replaced legislation dating back to 1956, has given more focus to corporate governance, risk management and mandates an auditor report on internal financial controls. 

"The Companies Act 2013 recognises the fact that more accountability and corporate governance need to be in place for organisations," Garyn told ET. "The Act showcases the importance of internal audit in corporate governance." IIA, based in Florida in the US, has more than 1,85,000 members across the world. It has six functional chapters in India. Garyn feels there is much ground to cover in terms of skills. 

"There's a lot of opportunity within India to increase level of governance. IIA publishes the globally accepted set of standards to which the Indian standards, set by the local authorised body, are closer but there are differences in some areas compared to other places. The sectoral knowledge, for sectors such as IT and related areas, has to be beefed up. Number of people engaged in audit reporting services in India will rather grow dramatically," he said. (Economic Times)