As an Internal Auditor do you receive a year end bonus based on specific financial/growth targets?

You might add a second poll - as an internal auditor, should you receive a year-end bonus based on specific financial/growth targets?

This is basically what I am contemplating. It seems to me that an auditor should not receive a bonus based on specific financial targets. I was wondering what the actual practice is among other FIs.

Everyone in our company is eligible for some sort of incentive compensation based 50% on company performance and 50% on individual performance. I don't see a problem with our structure and it certainly provides additional incentive to accomplish special tasks that add value to the organization. Note that we're a mortgage bank, not a general bank, but either way, I think bonuses are a good tool. Besides, if everyone at the company was eligible for a bonus except IA, how would you ever recruit people into audit??

Like BethF, our bonuses are part company performance and part individual performance. But I think the original poster isn't asking about general performance, but a specific target goal. Our bank has some employees who have bonuses based on targets, but they are almost all in positions that could be considered "sales", like commercial lenders. I don't think an auditor SHOULD receive bonuses based on specific targets - that could affect our independence.

If your specific targets are completion of the audit schedule, obtaining a professional certification, etc. (things that you control), I think that's reasonable.

If you are being compensated based on the bank's meeting of a financial target, I think that has the potential to compromise independence.

Ms Auditor - Please state some of the specific financial/growth targets Audit is measured against.

As it stands now IA will be included with the rest of the staff and will not be given a bonus related to specific audit goals. Some of the targets for the bank include: Loan & Deposit Growth, Non-Interest Income, Past Dues, Net Charge-Offs and Efficiency Ratios. I don't believe that it is appropriate for IA to be given a bonus based on the above.

Ms Auditor,

The question is: Are you an employee of the financial institution? How would you justify yourself receiving a bonus for doing your job as everyone else has? There are many variables that go into the decision to give bonuses. If you feel you are due a bonus but the conditions of the FI to not currently allow for such a bonus, then maybe you should ask for a raise or maybe even look for another job with someone who provide sucha compensation package for you.

Complianceman - I think you missed the point. The question becomes - does it represent a conflict of interest to base a bonus paid to the audit staff on financial results of the corporation. This might result in them approaching significant findings that would dramatically impact the bottom line a little differently. IMHO - bonuses for audit staff should be based on other types of goals.

I'm receiving bonuses like all the other employees of the bank, the bonus is based on the bank's result.
In my opinion I think that if bonuses have to be disbursed to Internal Auditors this issue must be discussed with the Board Audit Committee who will decide wether to do it or not and what will be the parameters to be taken into consideration for that, in this case I think the independance of the internal auditor will not be altered.