According to Dereck Barr-Pulliam (PhD, CIA, CPA) in ” Engaging Third Parties for Internal Audit Activities, he states that A global average of 38% of CAE’s say they use third parties for internal audit activity. It was further noted that the average percentage of activity performed by a 3rd party recorded a 21% for Sub-Saharan Africa. With the next year indicating a 42% increase in the use of 3rd parties being utilized. On average, 1 out of 3 internal audit departments worldwide say they use third-party services to some extent.

Third-Party services are commonly used to:

• Provide specialty skills not available in the Department
• Solve Staff Shortages
• Supplement Staff on an ongoing basis
• Cover remote business locations
• Perform special projects

The type of usage differs according to the characteristics of the organization. To illustrate, he compared third party use between a Swiss Financial services organization and a Middle East oil company.

The Swiss Financial services organization due to a small staff, used mainly third party for a large portion of their activity. The service providers assisted with 40% of the assurance and consulting. The oil company having a much larger staff, did not need much support from service providers however third parties were used to provide language skills and other specialized oil and gas expertise.

Successful management is of utmost importance to ensure best practices for relationships with third parties. This involves setting clear objectives, ensuring you choose the appropriate provider, supervision of the activity and proactively maintaining this relationship.