Which of the following is true regarding the ability of the internal audit activity to perform assurance services after providing consulting services?

The ability of the internal audit activity to perform assurance services after providing consulting services hinges on the management of objectivity. When internal auditors provide consulting services, there is a potential conflict of interest that could compromise their objectivity in subsequent assurance work. However, if the auditors appropriately manage this objectivity—often by involving different auditors or ensuring independence in the processes—they can successfully deliver assurance services thereafter.

This management of objectivity is crucial because the internal audit function is expected to provide an unbiased and accurate assessment of the organization’s operations and controls. Effective safeguards, such as peer reviews or establishing clear boundaries between roles, can help mitigate any concerns arising from the dual nature of consulting and assurance services. This allows internal audit functions to maintain their credibility and continue to add value through both types of services without undermining their impartiality.

In contrast, the other options imply limitations that are not necessarily aligned with internal audit practices and standards. Assurance services can follow consulting services when managed correctly, thus providing a broader scope for the internal audit activity to operate within its defined roles and responsibilities.