What are the benefits of internal audit for a company?

Internal audit can play a vital role in improving the performance of a company. Internal auditors assist companies in identifying key risk factors. This enables the company to anticipate potential future concerns as well as identifying current weaknesses. It also enables a company to identify processes and controls that are not working effectively and allows an opportunity to improve on these.

What is internal audit?

The role of internal audit is to provide assurance that a company’s risk management, governance and internal control processes are operating effectively. Internal auditors must be independent from the operations they evaluate and report to the highest level in a company – senior managers and Board of Directors or the internal audit team. Internal auditors work with management to review systems and operations. These audits identify how well risks are being managed by the company and whether the right processes are in place, and whether procedures are followed. Internal Auditors evaluate the controls a company has in place. They also identify areas where improvements might be made and where procedures might be done more efficiently.

What are the benefits of internal auditing?

The benefits of an internal audit trickle down through all aspects of your business operation.

  • It identifies issues with the management. When an internal audit is performed, one aspect they inspect is the way management works with the staff. If there is a problem with management communication the auditor can demonstrate what the possible resolution may be found
  • The audit enables testing of internal control systems. Internal auditors comb through all the processes in your business and tell you how to improve them.
  • It helps to identify internal issues and problems. While you may understand that there is a problem, you might not know where the cause of it lies. Internal audits look at the root of the problem and tell you what can be done to remedy the situation.
  • It establishes the responsibility of risk control and management. The internal auditor establishes who should be held responsible for certain risks, and the management of these risks.
  • It assists people in the understanding of their responsibilities. Often people are unaware of who is responsible for certain processes. Internal auditors will identify who is responsible, and tell other members of staff.
  • It improves information flows in the business. Information given to staff may not be of a high enough quality and this can lead to problems. Internal auditors will assess the quality as well as the quantity of the information that makes your business run.

 

If you would like regular, independent internal audits of your ISO Management System, please contact Hannon Consulting Limited for a quote and a proposed schedule of audits at a frequency to suit you.

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