Well-executed audit planning sets the tone for an audit — an audit is more likely to be effective for all parties involved if time is taken to plan it correctly. Uplevel your next audit with a downloadable audit planning checklist, critical risk areas to consider including in your audit plan, and top metrics to track in your audits.
Audit planning is an essential — but sometimes overlooked — part of the audit process where internal audit’s preparation can put an audit project on a track toward success. The work of effective audit planning can not only lead to more efficient execution, but also to smoother interactions with key stakeholders, the ability to track meaningful Key Performance Metrics throughout an engagement, and more effective risk management techniques.
We’ve collected three top audit planning resources from our Audit Management Playbook to help you optimize your next audit plan — and you can download the full Audit Management Playbook below to learn everything you need to manage your audit program.
Planning an Audit from Scratch
Sometimes, audit teams have neither the knowledge nor the subject matter expertise needed to provide assurance for areas that have never been audited before. Unfortunately, these areas often include processes that support an organization’s strategy and key objectives. In such scenarios, auditors may initially approach the project by Googling “how to audit XYZ” or “XYZ audit program,” but the resulting project scope often amounts to testing several controls, highlighting exceptions in the audit report, then moving on to the next audit. Recommendations might consist of “Internal Audit recommends following the policy and procedure…” but will rarely provide any actionable insight to create positive change.
This approach not only fails the audit customer, but also harms internal audit’s performance and reputation.
Auditors who create and document custom audit programs from scratch, versus relying on checklists or template audit programs found on Google, are better equipped to perform audits over areas that are not routinely audited. And, when internal audit can spend more of its time and resources aligned with the organization’s strategy and key objectives, the benefits can — and do — multiply.
Download the Planning an Audit From Scratch Checklist to get started auditing new and important areas of the business.
5 Critical Risk Areas to Include in Your Audit Plan
A well-rounded audit plan will not only meet Sarbanes-Oxley (SOX) or other compliance requirements, but will also reflect an enterprise-wide scope and coverage of risks. Internal audit has a key role to play in identifying areas that need attention and safeguarding strategic assets by mitigating potential future risks. The more comprehensive coverage an audit plan can provide across different categories, the more internal audit will position themselves as a partner adding value to the organization.
Download our 5 Critical Risk Areas to Include in Your Audit Plan with important risk areas and recommended audit projects for each category.
Track Key Metrics in Your Audits and Audit Plan
As internal audit faces perennial pressure to cut costs, it is ever important for the department to prove its value as a contributor to business goals. Performance metrics communicate the effectiveness of internal audit activities and their alignment with organizational objectives.
What sets good metrics apart from the rest?
Key performance indicators (KPIs) are quantifiable measurements that demonstrate the effectiveness of an individual, department, or organization in achieving key goals. Clearly defining goals and tracking meaningful KPIs provide valuable evidence demonstrating that internal audit’s activities support the organization’s strategic objectives.
Learn which metrics you should track as you plan, perform, and report on your next audit project with the checklist of Top Metrics to Track in Your Audits.
Looking for more resources to take your internal audit team to the next level in 2020? Download the full Audit Management Playbook below and get more best practices, checklists, and tools for each stage of the audit lifecycle — planning, fieldwork, reporting, issue management, and scaling audit practices.