Internal auditing is an activity which many companies must complete to comply with ISO requirements. An internal audit is a way of collating and producing independent information regarding the internal control processes, governance and risk management of the company. There are a number of benefits to hiring competent and capable internal auditors.
Why Your Business Needs Internal Auditing
An internal audit is not just about satisfying a regulatory quotient that adds no value to your business. It is widely recognised throughout different industries as a way of helping companies achieve their goals. It won’t just help minimise risk either – instead it can:
1. Provide you with incisive insights that’ll palpably improve performance
2. Identify ways to help you develop more efficient ways to run your operation
Forbes conducted a survey in 2010 that verified the importance of internal audits, with 94% of respondents agreeing that the function contributed positively to the development of their business.
How Often Should An Internal Audit Be Done?
You may wonder if there are any regulations that dictate how frequently these audits should be performed. The fact is, that it is up to the company in question – there are no binding regulations regarding this practice. You should consider the type of work your company does as this can determine how often you will require an internal audit. Companies with high levels of risk in their operational practices, such as construction companies or waste disposal companies should have audits completed frequently. For most medium and large companies, the rule of thumb is to have an audit done every three months.
Who Has Access To The Reports?
Once your internal audit is completed, the reports need to be available to a couple of key groups:
- The management and governing board of the company. These are the people who can address any problems the audit uncovers.
- External auditors. When your annual external audit is completed, the auditors may ask for these reports to verify your internal processes.