About Internal Audit
WHAT IS AN INTERNAL AUDIT?
“Internal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization’s operations.
It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes” (Institute of Internal Auditors, 2019).
WHY NEED AN INTERNAL AUDIT?
An Internal Audit is essentially a pre-emptive maneuver to maintain financial reliability and operational efficiency, to safeguard company’s assets.
Key functions of Internal Auditor:
1) Evaluate Risks
Working together with the management to look at the key risks faced by the business and how to manage the risks effectively.
2) Manage Risks
Working together with all levels, including assessing the tone and risk management culture of the organization to evaluate and report on the effectiveness of implementation of management policies.
3) Analyze Operating Procedures
Working together closely with managers/owners to review operations and report findings.
Provide an in-depth overview of the operating procedures of every department in the company and able to advise on how to optimize them.
4) Provide Assurance
Work with other providers/parties, especially audit committee to ensure that all available assurance resources are optimized.
WHO REQUIRES AN INTERNAL AUDIT?
An internal audit is not something only larger companies need. As this speaks, even small businesses would benefit from internal audit.
You may ask, how will Internal Audit benefit my small business?
If any of those questions are exactly what you are thinking right now, an internal audit service would be the most suitable service that we can offer to you, and the reasons are the following:
You define the scope of the internal audit. In other words, the audit objective is assigned by the business owner. There will be no other procedures performed other than those that are necessary for the audit objectives.
Internal audit reports go directly to you. No outside agency or adversarial entity will know the audit findings, especially those that may have a negative impact on your business.
It serves as an early warning system comparing to external, regulatory, or compliance audits. It allows you to identify the deficiencies and rededicate them on a timely basis.
It provides recommendations to improve the efficiency and effectiveness of procedures.
Internal audit is deemed to be a value-added service and has been able to benefit small businesses that struggle with deficiencies and needed improvements.