When creating policies and procedures for the internal audit activity, it's important to consider factors that directly influence the functioning and effectiveness of the audit process. These include the complexity of audit activities, as more complex activities will require more robust procedures; the structure of the IAA, as the organization's arrangement affects how policies are implemented; and the audit staff skills and competencies, as these determine the ability of the team to effectively carry out audit procedures. The number of auditors is less relevant to the creation of policies and procedures compared to the other factors.