Five Things To Look For When Selecting Internal Auditor
Identifying the right internal auditor is a crucial business decision and professional CPA firms vary widely in terms of capabilities, resource availability, qualifications and much more. Establishing a relationship is important, as your internal auditor provides business insights and becomes an integral part of your organization’s long-term success. Here are some key areas to evaluate when choosing the right auditor:
Your auditor should have experience in your field. Through references, they should be able to demonstrate their experience auditing organizations similar in size and complexity to yours. Accounting is a dynamic field, so ask potential auditors how they remain current with new regulations and what their continuing education requirements are. The best auditing firms will also have employees with longer tenure, which increases depth of expertise and enhances relationships with regulators.
Quality Control (QC)
A great internal audit firm will regularly perform quality control audits. During this review, an independent group will carefully review internal audit deliverables to ensure accuracy. Ask about the firm’s QC process, including key statistics.
Effective and frequent communication is crucial to the success of a relationship between the auditor and auditee. You should be able to communicate freely with a potential auditor when you initially meet with them. Ensure that you understand the answers they provide. Accountants can be overly technical, so it is important that your auditor explains things in a manner that you and others in your organization can easily understand. Additionally, if an auditor’s proposal document is not comprehensive nor clearly articulates key tenets of the RFP, this may be a bad omen for future communications and deliverables.
An important consideration during the selection process is the audit firm’s reputation. Request references and speak to them. If they do not provide three or four relevant references, they may not be the right choice for you.
While selecting an auditor should not be based solely on the cost, it is an important aspect. At least three bids should be received to determine if all offers are competitive. Additionally, internal audit firms are sometimes willing to offer multi-year engagements at comparable or slightly reduced rates compared to one-year engagements. If a firm is willing to do this, you will bring certainty to your costs in future years.
Additionally, a proven and reliable professional audit firm should do the following:
- Follow your company’s professional standards of work
- Retain your company’s processes and requirements, eliminating the need for repeat orientations or backtracking for future engagements
- Understand your company’s structure and policies, and work within them
- Offer relevant industry insight to the audit committee and top leadership
- Follow all compliance regulations and offers relevant updates
- Maintain good standing with relevant professional organizations
- Help your organization streamline all auditing processes, and improve efficiency and effectiveness
- Impart auditing tips and advice to your in-house auditing staff (if applicable) through scheduled training
How Cherry Bekaert Can Help With Your Internal Audits
Whether your company is experiencing staff shortages, or needs to outsource or co-source your internal audit functions, our dedicated Risk Advisory team at Cherry Bekaert offers the necessary expertise and professionalism to conduct highly effective and efficient internal audit services. By leveraging our knowledge of internal controls, cybersecurity and information technology, we can help you streamline processes, mitigate risks and maintain compliance requirements. Reach out to your Cherry Bekaert advisor, or our Risk & Accounting Advisory practice to learn more about our competitive rates, flexible service model to meet your organizational needs and experience the difference with insights on the latest trends and compliance matters.