An internal audit procedure is a document that details all of the necessary processes that should be performed before, during, and after an audit. Having such a document on-hand can be a major benefit to you and your business.
How can an internal audit procedure help you? A well written internal audit procedure is a useful guide for all parts of an audit from start to finish. This procedure keeps everything you need for internal audits in one place and ensures your audits are always done properly.
It may seem complicated to put together all of the components required for an internal audit procedure, but they all follow a similar structure. In the end, having a procedure on hand will benefit you in a number of ways. Read below to learn more about how an internal audit procedure can help you.
It can be easy to dismiss internal audit procedures as useless or a waste of time. In reality, they are extremely helpful tools when it comes to the entire auditing process. Taking the time to ensure your internal audit procedure is detailed and thoughtfully written can help you achieve certain benefits.
At its core, an internal audit procedure is a manual. It spells out everything anyone needs to know about internal audits within your business from start to finish. Having this set of instructions means performing internal audits will be an easy process for anyone that is placed in the auditor position.
Not only does your procedure outline how to perform an audit, but it also provides instructions for planning and reporting audits. These guidelines ensure internal audits are done correctly, and the collected data is handled the right way. An internal audit procedure keeps everyone on task and leads to success.
An internal audit procedure is an all-in-one document for everything pertaining to internal audits. There is no need to go searching for everything separately when you have an all-encompassing manual to reference.
Guidelines aren't the only thing an internal audit procedure includes. You will also find schedules, audit checklists, process flow diagrams, and all other related documentation in your procedure. It will also detail who is responsible for audits and the purpose and objectives of audits.
Having all of this information in one place makes it incredibly easy for anyone that needs it to find it. An internal audit procedure is a comprehensive tool that aids in an efficient auditing process.
Internal audits are generally performed by many different people or teams of people. Having a procedure that outlines how audits are to be performed and handled makes certain that it is done the same way every single time.
It's essential to overseeing the success of your business to have a consistent approach to all parts of the internal audit process. If everyone is doing it their own way, you won't be able to compare data and find areas for improvement as easily. Having a framework for auditors to use means the resulting information from internal audits will be consistent.
While it's not a requirement, having a set of instructions for scheduling audits within your internal audit procedure is a big help in making sure it gets done. Along with guidelines for creating a schedule, you can include the most recent version of your audit schedule for everyone to reference.
Creating an audit schedule depends on reviews and knowing what processes need the most attention. If you keep up with the procedure of scheduling your audits, it will be much easier to create a workable and customizable schedule for all future audits.
Putting together an internal audit procedure can seem like a complicated task, but there are certain things that every procedure should include. Knowing about these things and referencing templates and samples can make it much easier to draw up.
Scope - The scope of any document tells what its purpose is. In the case of an internal audit procedure, the purpose is to outline the process of an internal audit as it applies to your business. This includes guidelines for the stages of planning, fieldwork, reporting, assessment, and follow-up.
Objectives - This section lists the objectives you are hoping to reach by performing an internal audit. It will usually talk about evaluating and finding evidence of success within a system. It could also include an objective about pointing out areas that require change. Whatever you are hoping to accomplish through an internal audit will go here.
Responsibilities - You should always include who is responsible for internal audits in your procedure. Don't put a specific name because then you have to revise the document every time there is a position change. It's much better to put a job title, so you don't have to worry about any updates to it in the future. Along with who is in charge, this section should list what exactly they are responsible for.
Planning - Every step that is relevant to the internal audit process in the lead up to it should be detailed in this section. This will usually include a specific way to plan each internal audit. It talks about meetings, reviews of previous audits, drawing up plans, scheduling, what needs to be addressed, etc. Internal audit planning should walk auditors through the process of getting everything ready to actually perform the audit.
Fieldwork - This is where the internal audit is put into action. Here the procedure will guide auditors through what needs to be done throughout an internal audit and how to document the entire thing. Any necessary checklists may be included in this section as well. These are perhaps the most important guidelines and should be written thoroughly so that they are easy to follow.
Reporting - Once the audit is done, an auditor must create a report of their findings. This section of the internal audit procedure outlines what needs to be included in the report and how to go about filing it. If you use a template for audit reports, it can be included in the procedure as well. Having these instructions on reporting will ensure that they are done consistently each time.
Follow-Up - Including guidelines for follow-up in your internal audit procedure will help make sure it is being done. This section can outline when and how an auditor should perform a follow-up. During a follow-up, the auditor will check to see that corrective actions have been taken to fix any problems found by the internal audit. A lack of follow-up means these actions may not be taken in a timely manner as they should be.
It can be hard to see the necessity of some documentation when it comes to running a business. However, an internal audit procedure is a goldmine of information that is incredibly valuable to you and every other employee. It ensures that performing internal audits is as easy as possible and that they are done correctly.
An internal audit procedure provides plenty of benefits to anyone that has one on-hand. It is a rulebook for performing internal audits that is full of useful information for auditors. Having all of that information in one place makes everyone's lives a lot easier. An internal audit procedure supports the consistency that is essential to improving any business.
By now, you should see the value in an internal audit procedure. The benefits are enough to make creating one totally worth it. Once you have the information put together, you will always have a helping hand when it comes to all of your internal auditing needs.
Written: 11th August 2019
Author: Richard Keen
Richard is our Compliance Director, responsible for content & product development.
But most importantly he is ISO's biggest fanboy and a true evangelist of the standards.
Learn more about Richard