Internal audits are crucial for businesses to ensure effective risk management, internal control, and governance processes. They provide an independent assessment of a company's operations and help identify areas for improvement. However, many Australian businesses may not be fully utilising the benefits of internal audits.

Today, we will share with you a couple of important tips to help you get the most out of your internal audit process and achieve better outcomes for your organisation:

Set Clear Objectives and Scope

To get the most out of an internal audit, it's essential to establish clear objectives and scope. These should align with your organisation's strategic goals and risk management priorities. By setting specific objectives, you can ensure that the audit will address the most critical areas of your business, providing more valuable insights and recommendations.

When defining the scope, consider the key risks and controls relevant to your organisation's operations. This may include financial, operational, compliance, and reputational risks. Ensure that the scope is comprehensive enough to cover all significant areas but focused enough to be achievable within the given timeframe and resources.

Engage and Communicate with Stakeholders

Effective communication and engagement with relevant stakeholders are critical to the success of your internal audit. This includes management, employees, and the board of directors or audit committee.

Ensure that stakeholders are aware of the audit's objectives, scope, and timeline. Additionally, encourage their input and involvement in the process, as they may have valuable insights and suggestions. Finally, open communication channels will also help to address any concerns or issues that may arise during the audit, leading to a smoother and more efficient process.

On top of all of that, involving stakeholders in the development and implementation of action plans resulting from audit findings will help to ensure their buy-in and support for the changes, leading to better outcomes for your organisation.

Leverage Technology and Data Analytics

Using technology and data analytics in your internal audit process can help to streamline the process and provide more valuable insights. Data analytics tools can help identify trends and patterns, detect anomalies, and assess the effectiveness of internal controls.

With that in mind, consider using data analytics techniques such as data sampling, data matching, and trend analysis to assess large volumes of transactional data, identify outliers, and assess the efficiency and effectiveness of your organisation's processes. This can lead to more targeted audit procedures and more robust findings and recommendations.

Additionally, using audit management software can help manage the entire internal audit process, from planning and execution to reporting and follow-up. This can help to ensure that audit activities are completed efficiently and consistently across your organisation.

Focus on Continuous Improvement

An internal audit should not be viewed as a one-time event but as part of a continuous improvement process for your organisation. It's essential to use the findings and recommendations from the audit to drive positive change and improve your organisation's operations and controls.

Because of this, ensure that management is committed to addressing any issues identified during the audit and implementing the necessary changes. Develop action plans with specific, measurable, achievable, relevant, and time-bound (SMART) objectives to address any deficiencies identified during the audit.

With all of the plans set up, monitor the progress of these action plans to ensure that they are implemented effectively and that improvements are sustained over time. Regular follow-up and reporting on the status of action plans will help to maintain accountability and drive continuous improvement within your organisation.

Evaluate and Enhance Your Internal Audit Function

Finally, to get the most out of your internal audit, it's important to regularly evaluate and enhance your internal audit function. Assess the effectiveness of your audit processes, methodologies, and tools, and identify areas for improvement.

So, consider benchmarking your internal audit function against industry best practices and the International Standards for the Professional Practice of Internal Auditing (Standards). This can help to identify areas where your function may need to improve to meet the evolving needs of your organisation and stay up-to-date with best practices.

On top of that, invest in the ongoing professional development of your internal audit team. This can include providing training and development opportunities, membership in professional associations, and access to industry resources and knowledge sharing.

Conclusion

By following these tips, your organisation can maximise the value and effectiveness of your internal audit function. This will ultimately lead to better risk management, improved internal controls, and enhanced governance processes, helping your organisation achieve its strategic objectives and drive continuous improvement.

Bloom Recruitment is an expert agency that specialises in recruiting for accounting and finance positions throughout Australia. We cater to various public practice accounting areas and in-house finance roles, with a commitment to offering a customised service that prioritises the needs of any client. If you are looking for an internal audit of your business, contact us today!