When the internal audit activity lacks the expertise to perform an audit engagement in a specialized area like IT, the most appropriate action for the CAE is to outsource the engagement to a reputable IT audit consulting firm. This ensures that the audit is conducted by professionals with the necessary skills and experience, thereby maintaining the quality and reliability of the audit.
IIA Reference:
IIA Standard 1210: Proficiency requires that internal auditors possess the knowledge, skills, and other competencies needed to perform their responsibilities. When the internal audit activity does not have the required expertise for a specific engagement, the CAE must obtain competent advice and assistance, either by hiring external experts or outsourcing the work.
IIA Standard 2070: External Service Provider and Organizational Responsibility for Internal Auditing advises that when the internal audit activity uses external service providers, the CAE must ensure that the provider possesses the necessary skills and knowledge.