General Business: How To Perform An Internal Audit
Speaking of general business, conducting an internal audit is the most basic approach in monitoring the internal business operations of the business, and identifying if there are inconsistencies. Not only that, internal audits are also performed so that the organization will know gaps in business operations and identify more opportunities for improvement.
Furthermore, this internal auditing procedure is conducted to determine any conformity or differences of the internal operations of the company with its systems. But the main purpose of this procedure is to confirm and ensure that the company’s terms and policies, as well as procedures are still being performed and followed, so that the head management will be informed about the gaps identified in the observance of the policies.
However, it can also be performed by either from the internal resources or team or by any external third party provider. The company who will request an external agency must make sure that it has a proven and tested internal auditing procedures and must be skilled in improving the welfare of the previous companies they have helped. However, the purpose of the entire internal auditing procedure is not to expose the mistakes of the specific company, rather to identify areas for improvement, which gives the company the opportunity to have and overall growth. The more the company accommodates internal auditing, the more they would be able to maintain their procedures and the quality of the company’s products, as well as enhance what still needs of any improvement.
Conducting an internal audit can consume a lot of time and resources, since it might be done daily, weekly, or monthly or annually. You will be able to find out here the basic steps in conducting internal auditing.
Firstly, identify the areas that require auditing. Make a list of the company’s departments and the functions of each by using the company’s policies and protocols.
Next is to determine the frequency of the internal auditing based on the company’s need. There are some departments that need only to be evaluated yearly, while some need to be audited daily or more frequently including those areas that have manufacturing procedures, ensuring the daily quality of the products.
The next step is to have a structured approach by marking the schedules of auditing on their own business calendars. This keeps their work to be done consistently and done regularly.
It is also important that the auditor is very skillful and knowledgeable about what to be reviewed about a specific area, to have an efficient auditing process.
And lastly, the auditor must record all obtained results and report them to the head office.