Companies: 10 Mistakes that Most People Make

General Business: How To Perform An Internal Audit

One of the most fundamental operations conducted on every businesses is the internal auditing, which helps identify and monitoring the internal business procedures within a company or business. When performing internal audits, the organization is assisted to identify more gaps and in their business operations, leading them to identify more opportunities for improvement.

Moreover, internal audits is a scheme of audit procedure that is performed within the organization to evaluate the congruence of the internal operations with their current systems. But the main purpose of this procedure is to confirm and ensure that the company’s terms and policies, as well as procedures are still being performed and followed, so that the head management will be informed about the gaps identified in the observance of the policies.

The internal audit procedures can be requested to any internal resources or can also be contracted out to any external third party provider. But before choosing an external agency, the company must make sure that the external agency is one who is skilled in auditing and has an organized internal auditing procedures that would greatly help the company. The company must be informed that the purpose of the internal auditing procedures must not about knowing the mistakes of a certain company but to identify avenues to be improved and to develop the entire welfare of the company. The more the company accommodates internal auditing, the more they would be able to maintain their procedures and the quality of the company’s products, as well as enhance what still needs of any improvement.

Conducting an internal audit can consume a lot of time and resources, since it might be done daily, weekly, or monthly or annually. You will be able to find out here the basic steps in conducting internal auditing.

Firstly, identify the areas that require auditing. List the departments and their functions that need auditing by making use of the procedures and policies made by the company.

Next is to determine the frequency of the internal auditing based on the company’s need. Departments who just need to be audited annually or quarterly are those that need the auditing of their documents and records, while manufacturing processes need daily quality control.

The next step is to have a structured approach by marking the schedules of auditing on their own business calendars. This keeps their work to be done consistently and done regularly.

Another thing is that the auditor must be knowledgeable of what needs to be evaluated to a specific area or department, to have an efficient and spontaneous process of auditing.

And lastly, the auditor must record all obtained results and report them to the head office.