What is an internal audit?

Internal audit is an independent advisory and verification activity. The purpose of the audit is to influence the improvement and operational efficiency of the organization. In its assumptions, internal audit refers to activities in the field of accounting and bookkeeping. However, nowadays it is mainly distinguished by an active risk management policy, or information security management. Apart from that, it is also a verification of compliance of processes taking place within the company and improvement of the whole organization functioning system. You should not equate audit with control.

Guidelines for auditing management systems

The internal audit process is described in ISO 19011 standard. This standard describes 5 most important principles which should be followed by an auditor. These principles are: ethical behavior, fair presentation, professional responsibility, independence, evidence-based. You can learn more about the principles that should guide the auditor in the course “System Management“.

Purpose of the internal audit

The main purpose of conducting an internal audit in organizations is to advise and verify the correct functioning of processes. The audit is intended to effectively prevent possible errors and eliminate risks related to, for example, personal data security. Conducting an audit consists in thorough verification of the actual state of the management system and the possibility of achieving the set strategic and operational objectives. A well conducted internal audit should be characterized by independence and objectivity. It is very important to adhere to the principle “evaluate the process, not the people”. This means that the auditor performing the audit must be able to make an objective assessment of the actual situation of the company.

How to conduct an internal audit?

The audit itself should be conducted in a structured manner. You will learn more about the auditing process in this course. All activities performed as part of the internal audit should also focus on a professional analysis of past events. This will not only help to correctly identify possible weaknesses in the organization, but also to concretize and develop systems for improvement within the company. An additional advantage of auditing will be the optimization of key processes in the organization and the verification of relations between these processes. Thanks to a broader view of the process, the internal auditor is able to “see” more than the owner of a given process.

Internal audit – benefits

Conducting an internal audit in a company can bring a number of tangible benefits. These include, first and foremost, changing the existing, unfavorable and unproductive solutions and habits of employees. This type of audit also makes extensive use of numerous data that provides greater insight into the company’s operations. Internal audit also plays an important role in shaping the value of the company. These benefits are mainly due to the fact that the audit makes it possible to implement optimized and effective internal procedures. Internal procedures facilitate not only the day-to-day performance of duties, but also the achievement of future strategic and operational goals. Internal audit is an element of continuous improvement that every company should strive for. The audit process and its results are also a valuable indication for the management.

The audit report and its conclusions may be the foundation for the implementation of optimization measures in the company.