Question

Describe the importance of internal audit and the procedural steps involved in it.

Answer 1

semi-annual or annual internal audit allows you to gauge the effectiveness of your business’s internal control system. Unlike an external audit, which focuses on determining whether financial statements conform to generally accepted accounting principles, an internal audit focuses on uncovering internal control weaknesses and evidence of fraud, waste or abuse at your company. Internal audit procedures and techniques are essential to effective risk-management implementation

Answer 2

HERE IS YOUR ANSWER

internal audit helps organisation achieve Cooperative objectives by keeping a pulse on a consistency of internal business practices.

The goal of an internal audit is to ensure organisational policies and produced are followed and to altert management of gaps in policy compliance.

The internal audit process can be done with internal resources or can be outsourced to an external third party vendor.

Some Steps Involved In It are as Follows :

1. Identify Areas that Need Auditing :

This can include areas as a complex manufacturing processes or as simplistic as accounting producers. make a list of each area and the functions of the areas that require review.

2. determine how often auditing in needs to be done : some areas near only need to be audited annually while some departments may require more frequent audits.

For example, a manufacturing process be required daily audits for quality control purpose while the HR may only required and on annual auditing of records and processes.

3. Create An Audit Calendar : a structure and systematic approach to the auditing process can help ensure the function get completed.

4. Alert Departments of Schedule Audits : it is simply common courtesy to give department notice of an audit so that can have the necessary documents and material ready and available for the reviewer.

5. Be Prepared : the auditor's should come prepared with an understanding of policy and producers and the list of items that will be reviewed.

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