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The internal audit function within a company is overseen by an Audit Committee, typically composed of three members from the board of directors. According to the Sarbanes-Oxley Act (SOX), this committee must include non-employee board members, meaning executives like the CEO cannot serve on it. The Audit Committee holds a fiduciary responsibility to shareholders and outside interests, acting as a check and balance between the auditors—both internal and external—and management. Consequently, internal audit functions report directly to the Audit Committee, enabling direct interaction between the two.
