Every entrepreneur must learn from the past, applying the lessons learned to take advantage of the present, to protect and build the future. Information is the key to success, along with experience gained over the years and ever-evolving skills.

The Internal Audit Consulting Firms have the role of making available the real state of the company, through an objective analytical approach, without leaving room for interpretation, offering instead recommendations for improving the development of internal activities, regardless of their nature or scope.

Since antiquity, the need for advice has been felt by knowledgeable people, who should highlight the advantages and disadvantages of an action, who should emphasize the consequences of a decision, knowingly advising. Thus, over the years, with the development of an increasingly wide range of industries and communication, information and promotion environments, the need to create an internal audit was felt. (Read More: Internal Audit – The Secret to a Successful Business!)

The internal audit of a company involves the study, analysis, and preparation of a related report to highlight the problems and irregularities within the company in question, focusing on all its plans, the main ones being:

• General organization
• Governance control
• Risk management
• Internal control
• Distributions of finances (budget).

There are standard elements that are found in the composition of an internal audit for a company, regardless of its field of activity. However, depending on the industry in which the business is located, additional sections can be found, meant to complete the report, personalizing it.

The internal auditor must have special, specific qualities that qualify him for his position in the company, he is being directly responsible for the accumulation, analysis, and transmission of information which can influence not only the present well-being but also the future of the entire company.

Depending on the profile and the industry in which the business falls, the form of the audit may vary slightly, being customized. However, its purposes remain the same:

• Verification of its activity, of its development, both by the internal standards and with those imposed by law
• Analysing the situation in connection with the internal organization, according to its norms and those of the legislation in force
• Comparison and identification of financial and non-financial data that have been requested by the manager to increase the efficiency of the activity
• Studying the financial and non-financial situation compared to previous periods, to determine the real situation of the company, but also its course over time
• Checking the quality level and comparing it with the requirements officially imposed by the internal control, on the efficiency and effectiveness
• Researching and re-examining the ways of applying security strategies, to prevent fraud, but also general losses, regardless of the nature of the goods
• Evaluation of all activities carried out in the company’s internal policies and procedures

In the end, the internal auditor makes a report by evaluating the company’s procedures and policies, comments on their application, and considers the regulation and implementation of the legal framework of the company.

This content is meant for information only and should not be considered as an advice or legal opinion, or otherwise. AKGVG & Associates does not intend to advertise its services through this.

Posted by:

CA Aman Aggarwal

AKGVG & Associates