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a) Highlight five benefits of an internal audit department in an organization b) Outline ten stages of an audit of financial statements.

      

a) Highlight five benefits of an internal audit department in an organization
b) Outline ten stages of an audit of financial statements.

  

Answers


Kavungya
a) Benefits of an internal audit department
• It dispenses the need to employ external consultants to act as internal auditors hence
saving large sum of money. This is even especially true when an internal audit
department is properly run with well trained and experienced internal auditors;
• The internal auditors are intimately acquainted with the business as they are continuously
employed in the same concern and have access to much confidential information and to
all levels of management. Hence, they really are "special" personnel who have very in
depth inner knowledge which can then contribute to the company;
• The Internal Audit maintains a group of highly skilled people available to cope with
nonrecurring and exceptional jobs which no many employee could deal with efficiently
and effectively;
• It ensures that the organization detailed standard policy and procedures are running
smoothly. This compared to the external auditors' primary role of the ability to express
the true and fair view of the clients' financial statements audit;
• Internal auditors are invaluable in areas like operational audits, constant examination of
internal check controls, the detailed application of normal auditing method and detailed
review of the various type of management reporting;
• Last but not least, it provides an excellent training ground for future executives. Trainee
personnel obtain intimate knowledge of the business which they can study problems of
all kinds at different levels

b) Stages of an audit of financial statement
i) Background research
ii) Preparation of the audit plan
iii) Accounting system review
iv) Internal control system review
v) Substantive testing
vi) Analytical review techniques
vii) Analytical review of financial statements
viii) Preparation and signing of the report
Kavungya answered the question on May 14, 2019 at 12:08


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