Why have Internal Audit?
The role of the section is to examine and evaluate the adequacy, effectiveness, and efficiency, of systems and procedures within the organization, and to recommend means whereby improvements can be made.
The results of Internal audits provide management with assurance that the internal control systems support the achievements of organization objectives. This helps management ensure that assets are safeguarded and that operations are efficient and effective.
In addition to these periodic evaluations, Internal Audit provides advice to managers on the controls to be build into new systems and procedures.
What is the difference with External audit?
The Internal Audit section assesses controls across all aspects of the business. External audit normally concentrates on financial controls.
How will controls affect efficiency?
A key objective for management is to ensure that the operations for which they are responsible are efficient and good controls will support this. For example, the timely provision of accurate information should enable the necessary monitoring of costs and performance.
Where the auditor identifies controls that are unnecessary, he will recommend that they be abolished. Where the auditor identifies controls that are ineffective or inefficient, he will provide suggestions for their improvement.
How will audit help me?
It is the responsibility of management to have effective and efficient internal controls. Internal Audit will provide an independent opinion on these controls and will suggest improvements. The auditors will therefore help the managers discharge their responsibilities.
Who decides what to audit?
The audit section will propose a plan to the Audit and Governance committee. This plan is drafted after taking account of the size of risks (amount of assets, income generated, etc.) and the controls thought to be operating. In addition, the plan is also discussed with senior management to ensure that their requirements have been addressed.