Why Do You Need an Internal Audit?
Does your organization really need an internal audit? Does an internal audit really help? Read on….
Ask yourself these important questions before you proceed:
- Is your business process-driven or people-driven?
- Is Standard Operating Procedure (SOP) being implemented in your organization and do you strictly implement company processes?
- How about strategic and operational risk management for your business?
- Have you implemented ERP or any other software and are you getting a desired output from your ERP?
- Have you applied for ERP process automation?
To find genuine answers to these questions, calling Control Assurance and Risk assessment specialists is the best way to grow your business.
But why do I need Internal Audit?
- Accomplish established objectives and goals for operations or programs.
- Get reliable and complete financial and operating information.
- Be compliance-ready for policies, plans, procedures, laws, regulations and contracts.
- Safeguard your assets.
- Make cost-effective and efficient use of your resources.
- Ensure management-controlled IT implementation and functioning.
OK, so how do I conduct an Internal Audit?
Step 1: Understand your Organization
- List down your business goals, objectives, strategies and risks.
- Document your business cycles, relationships, IT systems and protocols.
Step 2: Risk Assessment
- Know your key performance indicators.
- Know your critical success factors.
- Be aware of key business risks and controls.
Step 3: Audit Plan
- Identify and prioritize specific audits for a fixed period of time.
- Develop audit strategy for key processes.
- Summarize risk assessment plan for better understanding of senior management and audit committee.
Step 4: Audit Plan Execution
- Agree on the scope and focus of the Internal Audit project with the client.
- Understand and evaluate significant processes and related controls.
- Identify and assess significant risks.
- Identify IT controls and application controls.
- Perform detailed evaluation of controls on significant risks.
- Develop and execute efficient tests of key controls and report on their effectiveness.
- Document and report findings.
Step 5: Action Plan
- Communicate with management and audit committee.
- Convey significant internal control issues and ideas to improve operations.