Internal auditors – whose roles have increased in importance in recent years due to increased regulatory demands – were more likely to receive pay raises in 2012, and those with specialised skills and certifications received larger pay increases, according to new research.
The analysis, conducted by the Institute of Internal Auditors (IIA), also revealed that employers in North America are focusing more on work/life balance.
The annual Internal Audit Compensation Study showed that although the magnitude of raises was smaller than the previous year, a greater percentage of companies gave raises to all internal audit employees – 64% in 2012, up from 61% in 2011 and 28% in 2010 in the US. In Canada, 83% of companies gave raises to all internal auditors in 2012, up from 56% in 2010.
Compared with 2011, fewer North American internal auditors received pay bumps of more than 3.9% in 2012.
The study of 311 companies showed that a higher percentage of internal auditors, compared with non-auditors, received salary increases – 64% of organisations in the US gave pay increases to all internal auditors, whereas 35% gave raises to all employees. In Canada, 58% of all organisations gave raises to all employees, compared with 83% that gave raises to the internal audit staff. The IIA previously released data showing that budgets for internal audit departments were on the rise.
“This data suggests that organisations appreciate the critical role internal auditors play in helping boards, audit committees and executive management navigate today’s escalating governance, risk, compliance and control challenges,” IIA President Richard Chambers said in a news release.
The median salary of audit professionals has increased steadily, according to the survey. For example, US chief audit executives’ median pay in 2012 was $160,000, compared with $145,000 in 2011. IT auditors’ median pay in the US increased from $66,000 in 2011 to $74,300 in 2012 (see Exhibit 1 for details on other audit roles).
Auditors with professional certifications were paid more than those without certification. For example, the median internal audit salary for CPAs in the US was $92,200. The median salary for internal audit employees with no certifications was $65,000.
The study showed that internal auditors earned more if they specialised in IT; fraud and forensics; and environmental, health and safety audits. That’s compared with those who perform financial and operational audits or engagements related to compliance and regulatory activities (see Exhibit 2 for more on specialties).
The report also indicated that companies are paying more to hire and hold onto employees. Companies in the US and Canada reported that they increasingly used performance bonuses, increasingly paid above-market rates and budgeted more money for merit increases to attract and retain employees in 2012.
The research also showed that more companies are offering paid time off, and more employees are being paid for working extra hours. In Canada, in particular, more companies are allowing flexible-work arrangements for employees.
Exhibit 1: Yearly Comparison of Median Audit Salary by Audit Role (US)