What is the purpose of internal audits?
The role of an internal audit is to deliver unprejudiced assurance that an organization’s risk management, governance, and internal control processes are functioning effectively. Performing internal audits on a recurring basis keeps a company and its employees on their toes and at the top of their game. Organizations that periodically bring in a third-party auditor are proven to have a better handle on their compliance levels, financial performance, risk management, management control, and governance processes, as long as they demonstrate consistency.
With multiple standards, policies, and metrics to abide by, along with an evolving business process landscape, the need for internal audits is almost sacrosanct in today’s times. However, it is getting increasingly difficult for organizations to manage their auditing processes internally due to the intricacies and responsibilities involved in the entire process. By informing the executive management about the risks that have been elicited and assessed, internal auditors can help organizations to justify if they are managing the organization effectively on behalf of their stakeholders. This is encapsulated in the mission of an internal audit which is to enhance and protect organizational value by providing risk-based and objective assurance, advice, and insight. Therefore, internal auditors, along with executive management, non-executive management, and the external auditors of a company collectively form a vital part of the top-level governance of any organization.
Some activities that are involved in an internal audit include:
- Assessing organizational risks and Key Risk Indicators (KRIs)
- Conducting logical and technical tests on the samples that are identified to assess and confirm the existence of such risks
- Evaluating controls exercised and advising managers on areas of improvement
- Reporting control weakness and recommending workarounds
- Reviewing the workarounds implemented, their effectiveness in mitigating the risks and revising them accordingly.
- Working with other assurance providers like risk management professionals, compliance officers, fraud investigators, quality managers, and security experts
The following are the key benefits of conducting internal audits for your organization:
- The potential risks that are identified as part of internal audits go beyond financial issues alone. It provides you with an unbiased view of where your company lies in terms of its reputation, growth, its impact on the environment, and the way it treats its employees.
- A good internal audit will inform the decision-makers if the current systems and processes designed to keep the organization on track are functioning effectively.
- It will ensure that your business complies with the relevant regulatory laws, so that you do not unknowingly commit any statutory violations.
- Internal audits create an increased sense of accountability throughout the organization and enhance the management of internal controls within the organization.
Keeping the above in mind, we at Affility offer Internal Audit services that help our clients escalate their audit capabilities to the next level. Our risk-based audit methodology stems from our core principle of generating value for our clients through each engagement. We offer our expert internal audit services to upgrade your processes and address any issues that are identified as part of the internal audit.
We also provide:
- Pre-audit assignments and checklists to ensure the right parameters are covered in the audits.
- Thorough gap analysis while proposing resolutions to identified issues.
- Specialized consultations to help streamline the internal auditing process.
- Advisory services to set up a cost-effective internal audit function, so that the company can continue to have audits conducted in an effective manner.
- Development of financial manuals in order to ensure regulatory compliance.
- Internal audit insights that focus on all the high-impact channels of your business.
- Guidance on how to perform strategic performance reviews.
- A risk-based audit approach to generate quantifiable value and tangible outcomes for your business.
- Follow-ups with management to ensure that the suggested action plans are being implemented appropriately.
We believe in aiding our clients to set up a cost-effective internal audit function with guidance from our experts in the relevant industry, so that they can benefit from periodic internal audits, rather than treat it as a one-time activity. Each instance of an internal audit comprises the entire spectrum of processes of a business, offering a holistic view across multiple departments. Similar to most specialized professions, internal auditors require a specific skillset and a high level of technical knowledge. They must also be effective communicators, good project managers, analytically strong, and good negotiators – and our experts at Affility come with a culmination of these specialized competencies.
- Are your organizational risks being managed effectively?
- Are you making progress towards your compliance goals or are there any gaps?
- Are your corporate policies and procedures being executed correctly?
- Is there provision for improvement in these areas? If so, how can they be enhanced to add further value to the business?
If you would like to understand your company’s position better in terms of the above, send us a Quick Enquiry