Why Quality Assurance Reviews are Essential for an Internal Audit
How can you tell if your internal auditing team is competent? Are they working according to the organization's changes and closely following recognized standards and guidelines?
A quality assurance review (QAR) will let you know for sure.
A QAR is an examination of your internal auditing group. It's a means to evaluate the efficiency of your internal audit function and the benefit they offer. A QAR basically determines what a team is doing and how helpful it is. Quality assurance reviews are essential for maintaining the integrity and effectiveness of internal audits, ensuring that all processes meet established standards and best practices.
Benefits of an Internal Audit Assurance Review
Guidelines from the Institute of Internal Auditors (IIA) require external audits at least once every five years. If an organization's internal audit program satisfies the requirements of the IIA's International Standards for the Professional Practice of Internal Audit, then it has successfully passed the quality assurance evaluation.
This five-year review requirement must be met by any entity that claims its audits are "conducted in conformity with the IIA criteria (IIA)." But even despite regulations or reporting obligations, many firms nevertheless see a QAR as having enormous value.
Some of the many benefits include:
-
Ensure you have the correct team in place with the appropriate skill sets.
-
Learn where you can improve and how to do so in a way that is consistent with industry-best practices. Implementing regular quality assurance reviews helps internal audit teams identify areas for improvement and ensures that audit methodologies remain relevant and effective.
-
An external viewpoint can assist an internal team in identifying opportunities and blind spots that sometimes go unnoticed by those most closely involved in the activity.
-
Improve the reputation of internal audits both inside the company and with potential partners and investors.
How to Receive a Positive QAR Review Rating
Internal audit departments should adhere to a few fundamental principles in order to be of value while upholding industry norms. You'll need to meet a few of these fundamental criteria in order to get the "generally conforming" QAR review ratings. These criteria include:
● Establish a thorough internal audit strategy
● Make annual self-evaluations
● Retain all supporting paperwork for the internal audit department's work
● Provide the internal audit team direct access to a board or audit committee that is not under direct administration
In a similar way, your internal audit team may improve audit quality by honing their abilities, staying current with best practices, and consistently aiming to inject the right amount of professional skepticism and judgment into their work—it's a learned art.
In this approach, a QAR is more than just an internal audit team "test." By assisting them in determining where to concentrate their learning and growth, you may make a concrete contribution to their development. By prioritizing quality assurance reviews, organizations can enhance the credibility of their internal audits and build greater trust with stakeholders through consistent and reliable audit outcomes.
Seek Professional Help
Need help auditing your internal auditors? As the CEO of Charlesfs.com, Sabine Charles has 20+ years of experience as an Executive Audit Director assisting top executives from Fortune 500 companies in the areas of internal audit controls, business risk, fraud investigation, and operational auditing with a track record of success and shown leadership. Her experience working for the Big Four firms has aided her in developing financial infrastructure and honing auditing procedures that increase efficiency, cut costs, and spur economic growth. She has experience working at Deloitte, Citibank, and American Express and is knowledgeable in accounting in the financial services and higher education sectors, as well as global operational and information technology audits and investigations.