Internal audit in businesses

What is internal audit?

According to the International Federation of Accountants (IFAC), internal audit is “an evaluation activity established within an enterprise as a service, with the function of checking, evaluating and monitoring the appropriateness and effectiveness of accounting and internal control systems.

According to the Institute of Internal Auditing (IIA): “Internal auditing is an independent assessment and consulting activity within an organization, designed to improve and add value to that organization's activities. Helps organizations achieve their goals by systematically and systematically evaluating and improving the effectiveness of governance, control and risk management processes.

Internal audit has the following tasks:

– Check the suitability, effectiveness and efficiency of the internal control system;

– Check and confirm the quality and reliability of economic and financial information financial report, management accounting report before submitting for approval;

– Check compliance with operating principles, management, compliance with laws, financial and accounting regimes, policies, resolutions and decisions of accounting unit leaders;

– Detect loopholes, weaknesses, and fraud in the management and protection of the unit's assets; Propose solutions to improve and perfect the management and operations system of the accounting unit.

The function of Internal Audit has become an indispensable need for corporate governance, internal control and risk management activities of businesses in the current context. Internal auditors can perform audits to evaluate and make recommendations to improve governance processes or provide consulting on governance issues implemented by businesses. In fact, Internal audit is considered the "eyes and ears" of business management through inspection and review of all departments and functions in the business.

It can be said that Internal Audit is a tool that helps business leaders analyze investment and business activities, control and evaluate the business development strategies of the business and management behaviors. Internal audit provides the basis for business leaders to operate production and business effectively and dominate the market.

For people doing internal audit work

– Internal Auditors do not audit regulations, internal policies, procedures, and processes, but they are the main responsible person for developing regulations, internal policies, and procedures. that custom and process.

– Internal Auditors do not have conflicts of economic rights and interests with the audited unit or department; Internal Auditors are not allowed to audit the unit or department to which the operator of that unit or department is a related person.

– Internal Auditors are not allowed to participate in auditing activities, departments that they are responsible for implementing, or managing that department within 03 years from the date of decision not to perform. operate or manage that department.

– Ensure internal audit professional ethical principles: Integrity, objectivity, professional capacity and prudence, confidentiality, and professional conduct. The person in charge of Internal Audit, in addition to ensuring professional ethical principles, must also have monitoring, evaluation and management measures to ensure that internal audit workers comply with professional ethical principles. Internal Auditing Industry.

For business leaders

– For the Board of Directors, Council of Members, and President of the company:

+ Responsible for promulgating regulations on Internal Audit of the unit;

+ Create favorable conditions to ensure that the Internal Audit department fully implements its powers and duties according to regulations;

+ Review, check, and evaluate the effectiveness and efficiency of the Internal Audit department;

+ Take main responsibility for ensuring the quality of Internal Audit activities;

+ Equip with necessary resources;

+ Decide on the implementation of Internal Audit's recommendations and urge and monitor implementation departments;

+ Take timely measures when there are recommendations and proposals from Internal Audit;

+ Approve and adjust the annual Internal Audit plan to ensure the Internal Audit plan is risk-oriented...

– For General Director (Director) of enterprises:

+ Create favorable conditions for Internal Audit to perform assigned tasks and direct departments to coordinate work according to the regulations on Internal Audit;

+ Urge units and departments to implement recommendations agreed with the Internal Audit department or under the direction of the Board of Directors and Council of Members;

+ Notify the Internal Audit department on the implementation of the agreed recommendations;

+ Ensure the Internal Audit department is fully informed about changes and new issues arising in the unit's operations in order to early identify related risks...

Internal audit service of AACS Company

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Contact now AACS for advice and support

AACS AUDITING COMPANY LIMITED

Phone: 028 66 500 381 – Mobile: 0908 381 550 (Mr Manh) – Mobile: 0908 688 550 (Ms Phuong)

Email: info@aacs.com.vn