ACCT 601 Final Draft

Topics: Auditing, Internal audit, Internal control Pages: 20 (4036 words) Published: March 8, 2015

How to conduct an efficient and effective internal audit


Tina Johnson

Table of Contents 
I. Executive Summary 
II. Introduction 
III. Review of Literature 
IV. Analysis 
V. Recommendations 
VI. Summary and Conclusions
VII. References

I Executive Summary

There were numerous data sources, majority web publishing, which consist of articles directly from accounting journals and article written by other Accounting professional. This paper will explain how to conduct a successful internal audit. To have a successful internal audit the company must construct a sound plan, have an upbeat atmosphere and encourage an open dialog of communication between the auditor and the client. Today many auditing organization are demonstrating how the audit process will work through Web-based presentations. The first topic I will discuss is the four stages of an audit. First and Announcement letter- this is when the Internal Auditor Director informs the client of the audit. Next the audit committee will start the planning portion-this is when the auditor notifies the client of what information will be discussed. Typically objectives and the scope of examination are reviewed in the audit meeting. During this meeting the information about important processes within the company will be gathered; the organization mangers discuss existing controls, and how to approach the additional steps remaining to this audit. Then the audit committee would need to concentrate on informal communication and testing the transaction procedures. When the auditors conduct fieldwork; the main goal is to determine whether controls identified in the preliminary review are working properly, in the manner which the client described. To complete the fieldwork, they should develop a list of finding to be discussed in the audit report. During this report the auditor will conclude all audit findings and give any recommendations for the next audit.

II. Introduction

This form of auditing is used in a broad range of areas including regulations. Traditionally audits typically don’t cover growing concerns such as information security; this is why the accounting industry has change dramatically for internal auditing throughout the accounting field. This paper will focus on Information Technology and controls which covers emerging issues such as social media and how social networking can be used in business collaborations by offering brand protection, legal or regulatory violations and accessing confidential data. I will also be covering mobile devices such as tablet and cell phones which are becoming more common in the workplace and how they may threaten data security through malicious software having a negative effect on the company’s hardware. As well as understanding the importance of external computing solutions such as the cloud, which gives a third party authorization over a network, the internal auditing department doesn’t even have. This paper will cover the best way a company can control a risk, sharing, accepting and most importantly avoiding risk. After reading this paper the audience should be able to apply each position of the fraud triangle and prevent each element of fraud with an internal audit. The purpose of this paper is not only to discuss the step to complete an internal audit, but what events lead to an audit, and preventing and audit with the help of current technology.

III. Review of Literature

I will list four methods any successful audit should follow. Embedded audit module- a programmed module or segment inserted in the application program. This method is used to monitor and collect data from transactions processed online through a computer-based system. Any data collect will assist the auditor to evaluate control risk and in the test of controls. In order to successfully...

References: Chartered Institute of Internal Auditors Retrieved from:
Metric Stream, 2015 Retrieved from:
Cytraus Aldona, 2015, Compliance Audit; Retrieved from: Reference for business Encyclopedia of Business 2nd ed. Retrieved from:
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