An internal audit is a systematic review of a company's internal processes and systems, conducted by the company's own staff, to assess their efficiency, effectiveness, and compliance with relevant standards.
The purpose of an internal audit is to identify areas for improvement, identify potential risks or issues, and recommend changes to improve the overall performance of the organization.
Internal audits can focus on a specific area of the business, such as financial reporting or supply chain management, or be more general in nature. They can be conducted on a regular basis or as needed, depending on the needs of the organization.
It can be hard to fix problem areas of your business that you don’t know about. An internal audit can show you trouble areas you may not have been aware of.
An internal audit is a great way to find issues in your company that could lead to significant problems if not corrected.
Identify and addressing any bottlenecks or delays in your processes that would affect the customer experience.
Reduce costs and increase profitability by identifying ways to streamline processes to reduce waste and increase efficiency.
It is vital for a company to be compliant with all standards and best practices relevant to their company. An audit can help ensure compliance.
An internal audit can empower employees to give thoughts and ideas that can benefit the company.
Do different departments and teams within your company communicate effectively? An internal audit can help identify communications methods used within your company and help determine ways to improve efficiency within departments.
An internal audit is a great way for your company to stay in compliance and ready for any future external audits or inspections.
Below is a checklist companies can use when conducting an internal audit. These steps are general in nature, and can change based on company size, industry, and any specific regulations that must be followed.
Create a detailed list of the departments, processes, and systems that will be reviewed to ensure all parties know what is being audited.
Any relevant documents must be reviewed to ensure they are up-to-date and comply with relevant laws and regulations.
When assembling this team, make sure those selected have the necessary expertise in the areas they will be reviewing.
Any risks or weaknesses found during an internal audit must be documented and plans developed for correcting any issues.
Have these documents ready for review by internal auditors, including financial statements, contracts, and policies.
Make sure employees and stakeholders are aware of the audit schedule and plans.
To help the audit process go smoothly, cooperate with auditors by replying quickly to requests for information.
After the completion of the internal audit, review the report and look at ways to implement recommendations and take corrective actions where needed.
Internal audits are a valuable tool for companies looking to improve the efficiency, effectiveness, and compliance of their internal processes and systems.
Conducting an internal audit allows businesses to identify areas for improvement, mitigate potential risks, and make changes to enhance performance and profitability.
If you have questions on how to conduct an internal audit on your business or would like an outside organization to conduct your audit, contact one of our professionals today.