Internal Audit is an independent process, objective assurance and consulting activity designed to add value to organization’s operations. Internal Audit is a holistic activity as it brings a systematic and disciplined approach to companies operations. It improves by and large complete health of the organization and improves the effectiveness of risk management, control, and governance processes.
The scope of Internal audit is:
- Organization’s governance
- Risk management and management controls over: efficiency/effectiveness of operations (including safeguarding of assets)
- Reliability of financial and management reporting
- Compliance with laws and regulations
The Internal Audit has following phases:
The idea of hiring an independent Internal Auditor is to keep whole process unbiased and independent of pre-conceived notions. This will help the auditor maintain integrity and keep the whole process fair and just.
Finally, the Internal Auditor issues the report including findings, recommendations and suggest plan of improvement wherever necessary.