Accounting is an activity of maintaining final records that require an orderly procedure to achieve desired results. Internal auditing is a function performed by a profession where he analyses and evaluates business projects or activities, determining the best in overall to help in achieving the objective of the business thus giving a recommendation. In entails evaluating or examining various business policies and procedures, through this evaluation he will be in a position to offer quality advise to the management on the right activities that will generally help achieve the company goals. An internal control helps improve or manage the organisation risk and capital requirement. This results to better management skills and strategic decision making of the company (Birkett, 1999, p. 123). An internal audit being one of the controls maintained by the company, benefits go beyond these of an internal audit. Internal audit is therefore a continuous process that evaluates the effectiveness and efficiency of company activities and the various controls and at the end gives a recommendation on various controls to install in order to maintain high performance in the company. An internal audit is always important to all companies or organization regardless of the size or the service or product that it offers. Audit practices whether internal or external audit are independent meaning that they do not have any influence whatever from the management (Fargason, 1992p. 23). This goes a long way of assuring the public of the credibility of the organisation. This ensures that organisation financial practices are free from fraud and are self dealing. Therefore the company may gain various advantages on using internal auditing.
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Benefits of internal auditing
Through installation of the internal audit the company will be in a position to review the reliability and integrity of financial and operating information. Through this review the auditor will analyse any risk that is likely to occur and hinder the company from goal achievement. These will enhance company reliability and compliance of the company goals and objective (Frigo, Krull and Stephen, 1995p.90).
The role of internal audit is reviewing the systems used by the company. This ensures that the policies, procedures, plans and laws, are effective and significant in company day to day performance.
Through internal auditing various controls will be maintained to safe guard the assets and various activities to ensure they are well maintained and that the records are clean free from fraudulent acts. Through the internal audit the organisation will enhance efficiency in its operation. With the relevant control the organization will be in a position to plan for the future and plan effectively which contributes to a successive business. Therefore the internal auditors will advice on the best to control to be installed to help in smooth leaning of the business (Birkett, 1999, p.234).
Internal audit will significantly improve the performance of the employees and competence. Through the controls assessed on employees such as job rotation will help improve employees’ credibility and competence in their work hence great achievement in the organization (Fargason, 1992p. 54).
As compared to the outsourced that is an external auditor the internal auditor will be permanently be in the business and will be in involved in the day to day running of the organisation hence he can be in a position to identify where the company needs evaluation.
Conclusion and Recommendation
Bearing in mind of the above benefits of internal audit I advocate for the hiring of an internal audit. This post suits John Doe who is quite qualified for the post. He is well trained in auditing and registered with the internal auditor association. He has worked with us for five years, he is well aware of the rules and procedures that are relevant to conduct an internal audit. John is committed to his work very independent without influence from the organisation and keeps the companies information confidential and only released to the relevant people. In his work he produces excellent results that help steer the company to the right direction. Hiring john, the company will be in a position to maintain competence in the day to day performance, hence great achievement in the near future. He is highly skied able to cope with non-recurring and exceptional jobs hence ill be in a position o suit well in the organisation. I am quite confident your will not regret if you give him the job since the records will prove it.
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Birkett, W. P. (1999).Competency Framework for Internal Auditing (CFIA). Altamonte Springs, FL: The Institute of Internal Auditors Research Foundation.
Fargason, J.S.,(1992) Law and the Internal Auditing Profession. Altamonte Springs, FL: The Institute of Internal Auditors.
Frigo, M.L., Krull, George W., and Stephen V.N. Y.,(1995) The Impact of Business Process Reengineering on Internal Auditing. The Institute of Internal Auditors Research Foundation.