The importance of internal audit to your business was the focus for a panel discussion meeting held at Butterfield Bank yesterday.

The meeting, which was held by the Bermuda Chapter of the Institute of Internal Auditors and followed by its Annual General Meeting (AGM), was made of a panel including Alan Thompson, CEO of Butterfield Bank, Sheila Lines, CEO of KeyTech, Fred Donner, chief financial officer of Renaissance Reinsurance Holdings, and Andrew Gibbs, chief financial officer at Ace Tempest Re, who all gave an insight into how some of Bermuda's top companies maximise the value of their internal audit functions in an ever-changing environment.

Among some of the topics up for debate were how internal audit can add value to a firm, the critical success factors for a leading internal audit function, how to assess internal audit's effectiveness, how it adapts to a changing environment, and its role with Enterprise Risk Management (ERM).

The panel talked about the success factors behind a top class internal audit function and how that function has been able to add value to the business. Ms Lines said it was crucial to have resources that really understand the company and what it does and to look at where risks exist within it.

She added that her telecommunications firm uses internal auditing to review its business continuity and help it develop templates for crisis response situations.

Mr. Thompson said that during his 30 years in the banking sector he had seen a big change in the way internal audit was carried out and that now his bank required individuals that really understand the business from a strategic level downwards.

"The internal audit function needs to interact with the senior and executive management and understand the strategies of the company," he said.

"It has to understand where the business is going and what are the risks associated with it."

Mr. Gibbs said his reinsurance company's priorities depended on how it audits ERM and how the internal auditor fits into the scheme of that.

He stressed that it was vital for internal auditors to be both objective and get their facts right.

But Mr. Donner said certain things had not changed in terms of value added to the business by internal auditing, while it was key to have a function that is flexible enough to adapt to changes in the environment and company allied to the auditors having strong communication skills.

"I want an internal function that is going to be proactive in helping me to assess and understand risk," he said.

"I want it to bring things to my attention, to understand them and help me get my mind around them."

Other subjects discussed included the assessment of internal audit functions, the effectiveness of ratings systems, and valued skill sets and resource requirements needed by businesses, before the meeting was turned over to the AGM.