An internal auditor is a trained professional who provides independent and objective evaluations of a company’s financial and business operations. They’re vital for companies to perform efficiently and follow procedures. Below, we explore the importance of internal auditors and what to do when they make a mistake.
Purpose
An internal auditor ensures that a company remains compliant and efficient. This is largely completed by evaluating the internal controls in a company. These are the systems implemented by a business to maintain the integrity of its financial and accounting information – they also help promote accountability and help prevent fraud. The purpose of an internal auditor is to also undergo risk management. An internal audit will often lead to the management team being presented with a report on liabilities within the business, with suggestions on how to lower the risks. As such, audits will take place repeatedly over consistent periods of time to continually monitor the business.
Mistakes to look out for
Internal auditors can make costly mistakes, however. To maintain a successful business it’s worth being aware of some common mistakes in order to spot them early on.
One of the main issues that can occur is when internal auditors fail to adequately educate management. When the internal auditor has their findings, they should find time to keep management and the auditing committee updated. If significant issues and outstanding risks aren’t relayed to management then the business could suffer as a result.
Poor planning is another issue that could affect an internal auditor. If your business is well aware of an ineffective control then it’s the job of the internal auditor to consult and find the original cause, rather than simply reporting that the control is ineffectual. Meticulous planning can help an auditor efficiently produce the information that a company urgently needs.
What to do if you’ve received incorrect advice
Sometimes though, you’ll receive and act upon incorrect advice to the detriment of the company. In this situation, you still have recourse though. If you’ve suffered from a mistake like this, you should contact a professional negligence lawyer to talk through your problems. Ideally, you should approach a lawyer with the appropriate qualifications, training, and experience to handle your case. Whether your business has suffered from poor auditing advice or incompetent legal advice, you can still make a claim to try and claim compensation.
An internal auditor can provide your business with plenty of value. From managing risks to helping make your operations more efficient, frequent audits are the sign of a healthy company.
