Do Thuy Dung - K17 KTTHCLC- Internal audit procedure.pptx

Internal Audit

1. PROCEDURE DO THUY DUNG INTERNAL AUDIT

2. CONTENTS 01 Introduction 02 Basic principle when conducting internal audit procedure 03 Steps in an internal audit procedure in international 04 Steps in internal audit in Viet Nam 05 Important and Benefit of an internal audit procedure 06 Some example of how internal audit procedure help organization

3. Definition : An internal audit procedure documents all of the necessary processes performed before, during, and after an audit. It also documents who is responsible for audits as well as the purpose and objectives of audits. Overview : This essay going to discuss about Internal audit procedures, benefits and essential of internal audit process. Internal audit procedures are an integral part of an organization's governance framework and risk management practices. INTRODUCTION

4. BASIC PRINCIPLE WHEN CONDUCTING INTERNAL AUDIT PROCEDURE Internal auditors are not allowed to simultaneously undertake the work of the internal audit team. In internal auditing, each area needs to be performed independently and separately to ensure the accuracy of reporting and evaluation. When performing internal audits, internal auditors must ensure objectivity, honesty, accuracy and fairness. Complying with the law and being responsible before the law is an important principle when doing internal audit. Internal audit ensures confidentiality, does not reveal trade secrets or disclose any information to other parties. I NDEPENDENT OBJECTIVITY SECURITY LEGALITY

5. STEPS IN AN INTERNAL AUDIT PROCEDURE IN INTERNATIONAL

6. STEPS IN INTERNAL CONTROL PROCEDURE IN VIET NAM Planning Review and Editing Monitor implementation of recommendations Perform internal audit Audit completion stage: This includes determining the objectives of the audit, the scope of the audit, and the resources needed. The audit plan needs to be discussed within the audit team to ensure that all members are oriented to the identified risks before submitting to the Head of Internal Audit for approval. The auditor will perform audit procedures to collect evidence about the audit contents agreed upon during the planning stage. After collecting evidence, the auditor will evaluate the evidence, synthesize, and evaluate the impact (quantified by data) of issues arising on the weaknesses of the internal control system and frauds. , errors,….. Periodically, Internal Audit collects reports on overcoming errors and fraud, and makes recommendations to improve the internal control system based on the audit results report.

7. Ensuring Effective Governance and Accountability Identifying and Mitigating Risks Enhancing Compliance with Laws and Regulations Improving Operational Efficiency Detecting and Preventing Fraud Providing Assurance to Stakeholders Driving Continuous Improvement IMPORTANT AND BENEFIT OF AN INTERNAL AUDIT PROCEDURE

8. Through regular internal audits, an organization discovered a fraudulent scheme where an employee was embezzling funds. The internal audit procedures identified irregularities in financial records, leading to the detection of the fraud and subsequent legal action An internal audit of a manufacturing company's production processes revealed bottlenecks and inefficiencies that were causing delays and increased costs. The audit recommendations led to the implementation of streamlined processes, resulting in improved productivity and reduced operational expenses. Fraud Detection and Prevention Process Improvement Compliance Assurance An organization conducted internal audits to ensure compliance with data protection regulations. The audit procedures identified gaps in data handling practices and security measures. As a result, the organization implemented enhanced data protection protocols, mitigating the risk of data breaches and ensuring compliance with regulatory requirements EXAMPLE OF HOW INTERNAL AUDIT PROCEDURE HELP THE COMPANY

9. EXAMPLE OF HOW INTERNAL AUDIT PROCEDURE HELP THE COMPANY Through internal audit procedures, an organization identified potential risks associated with the procurement process, including inadequate supplier due diligence. The audit recommendations led to the implementation of robust supplier evaluation and monitoring procedures, reducing the risk of fraudulent activities and ensuring supplier reliability. Internal audits of financial reporting processes identified control weaknesses that could potentially impact the accuracy of financial statements. The recommendations from the internal audit helped strengthen controls, ensuring the integrity and reliability of financial reporting, and providing greater transparency to stakeholders Risk Management Financial reporting Integrity Operational Efficiency An internal audit of an IT department identified redundancies and inefficiencies in software licensing and hardware procurement. The audit recommendations led to the consolidation of software licenses and the adoption of standardized hardware procurement processes, resulting in cost savings and improved operational efficiency

10. CONCLUSION In conclusion, the internal audit procedure plays a vital role in ensuring the effectiveness, efficiency, and integrity of an organization's operations. It serves as a systematic and objective evaluation of the internal control systems, risk management practices, and compliance with applicable laws and regulations. Through the internal audit process, organizations are able to identify areas of improvement, mitigate risks, and enhance overall performance.

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