Auditing is examining an organization’s accounting records and related procedures to assess the reliability of the data to provide an opinion on whether any discrepancies are due to error or fraud. Internal auditing is a quality control technique used primarily by private corporations, non-profit organizations, and other enterprises, including governmental agencies, to prevent and detect fraud or other forms of irregularity in an organization. With Internal Audit Management Software and Tools from Harrington Group International, it is now easier to discover fraud and irregularity.
The Basics of Internal Audit Management Software and Tools
Three essential elements are involved in the internal audit: the scope of the audit, timing, and documentation. The scope of internal audits is set by management. It depends upon factors such as the relative importance of the area under review, size of the organization, level of complexity, and relative cost-effectiveness. An audit typically includes examining an entire department or operation or specific activities within a department or operation. Timing is determined by the nature of the organization, the processes being audited, and the audit goals. Documentation is vital to understanding what was done, who did it, and why. Internal Audit Software and Tools from HGI streamlines documentation so that you can perform better internal audits.
Small audits can be performed on a sample basis with only a few employees or departments/operations involved. However, most organizations try to include several different operations within the sample selected for an audit. Medium and large-size audits may require the participation of several employees as well as external auditors. Manual procedures can be used to conduct a large-scale audit, but more formal internal audit systems are preferred when the scope of an audit is enormous.
In most cases
Internal Audit Management Software and Tools
, a corporate annual audit establishes the timing of the annual internal audit. Some organizations have an internal cycle for their annual audits. Each quarter or month, an employee or group from within a department or operation goes through the entire process with their supervisor. After the audit results are evaluated, any discrepancies are corrected, and improved procedures are implemented for future audits.
A sound internal audit system will provide documentation that states what process or operation was audited, by whom, when the process was audited, and any conclusions or recommendations from the audit. Documentation is key to understanding an organization’s internal controls and operations. The more documentation you have, the easier it is to determine problems, make recommendations for improvement and pinpoint the source of discrepancies.
While performing an audit, it is necessary to have a clear idea about the purpose of the audit. An internal auditor may be appointed by management or an independent entity responsible for evaluating an audit’s results and implementing any required corrective action.
Audit management software streamlines internal audit processes and documentation to help you perform better internal audits. In addition, the audit software helps with the confirmation of compliance. It allows you to do your audits more efficiently to make better decisions based on a thorough understanding of your processes and effectiveness.