The NASDAQ Stock Market LLC (Nasdaq) recently filed with the Securities and Exchange Commission (SEC) a proposed rule  requiring listed companies to establish and maintain an internal audit function.  The SEC is soliciting comments on the proposed rule through March 29, 2013. 
Under the proposed rule, the internal audit function would be required to provide management and the audit committee with ongoing assessments of the company’s risk management processes and system of internal control. In addition, new Rule 5645 would require the audit committee to:
- meet periodically with the company’s internal auditors (or other personnel responsible for this function); and
- discuss with the outside auditors the responsibilities, budget, and staffing of the company’s internal audit function.
Companies would be permitted to outsource their internal audit function to a third-party service provider other than their independent auditor. For companies that choose to outsource this function, Nasdaq has stated that the company’s audit committee maintains sole responsibility to oversee the internal audit function and may not allocate or delegate this responsibility to another board committee.
According to Nasdaq, the proposed rule is designed to: