internal audit

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Internal Audit

The process of reviewing business activities in-house to identify inefficiencies, reduce costs, and otherwise achieve organizational objectives. Internal audits may investigate potential theft or fraud and ensure compliance with applicable regulations and policies. They also assist in risk management. In a large company, especially a publicly traded one, internal auditing is conducted by a board independent from any management and answerable only to an audit committee, a subcommittee on the board of directors. The growth of internal audits accelerated following the 2002 passage of the Sarbanes-Oxley Act, which increased the accounting regulations for public companies.

internal audit

The examination of a company's records and reports by its employees. Internal audits are usually intended to prevent fraud and to ensure compliance with board directives and management policies. In contrast, the financial statements presented to stockholders are typically prepared by outside parties to ensure absolute objectivity. Compare external audit.

internal audit

see AUDIT.
References in periodicals archive ?
Recurring meetings between the company controller, internal audit staff, and external audit team should foster understanding of the external audit attestation process.
Early implementers (accelerated filers) experienced not only astronomical costs, but heavy burdens on their finance and internal audit staffs.
What they are finding is that the often narrow, mechanical nature of Sarbanes-Oxley testing has created a skills gap--particularly with newer internal audit staff members whose professional experience has consisted largely of Sarbanes-Oxley-related work.
Management's discussion of any remediation efforts most commonly addresses staffing issues--hiring an Internal Audit Director, hiring additional internal audit staff, or engaging an outside consultant.
The shortage of competent internal audit staff is the top challenge facing chief audit executives, according to a survey by ACL Services Ltd.
Only then can our internal audit staff get out of the compliance checklist business and focus on governance activities.
The concept of independence extends to the hiring, promotion, and firing of internal audit staff, and to all final decisions relating to reporting results or referring matters to appropriate external authorities.
We recruited senior internal audit staff who worked alongside PWC to fill the skills gap.
As my own case has shown, internal audit staff can be placed under tremendous pressure not to disclose their findings.
A QI could request the IRS to waive an audit by an external auditor if (1) the QI maintains a substantial and independent internal audit staff and (2) its internal auditors have determined that the QI is in compliance with its agreement for each of three preceding years.
Management continuing to employ ineffective internal audit staff

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