Q:
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What is internal audit?
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A:
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Internal audit is an internal evaluation inside company itself including corporate governance, internal control, accounting process etc. The internal auditors shall ensure the compliance to law, regulations and preventing fraud while maintaining the accuracy and timeliness of the financial reporting.
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Q:
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What is the function of internal audit?
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A:
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Internal audit is crucial to the company’s management because it helps the company management to maintain the quality of corporate governance, internal control, and accounting process. It is one of a management tools for management to evaluate the current situation of the company in a relatively independent way. It is important that now a days, in a lot of countries, management is legally responsible for the accuracy for the financial statements of the company.
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Q:
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What is the difference between internal audit and external audit?
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A:
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The difference between internal audit and external audit are breakdown in different aspects as follows:
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1.
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Employees of the company
Internal auditor are company employees while external auditor is hired by the company’s management from an outside audit firm.
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2.
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Appointment
Internal auditor is hired by the normal hiring process of the company, while company auditor is elected by the shareholders.
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3.
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Duration
Internal audit is conducted throughout the whole year, while external audit normally conducts an annual audit.
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Q:
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What is the general process of internal audit?
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A:
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Generally, internal audit will gather the general information of every department in the company and understand the critical governance procedures such as testing of internal control process, enquiry the department staff regarding to current issues etc. Then an audit report will be prepared and report to the board of director. The implementation of the recommendation shall be discussed and follow up with the management.
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FAQ
