If you have a business that has been in the market for years or you are just starting one, the fact of doing audits is just as relevant. Through audits, you can find opportunities for growth of your company, whether in terms of productivity, achievement of results or process optimization. Therefore, auditing is a great ally to know where to adjust in order to maximize results.
What Does Audit Management Involve?
Auditing is a method that companies take advantage of with the objective of evaluating the resources available and how functional the structure is. In addition, this evaluation allows to determine the degree of profitability that can be aimed at with this form of use.
Importance of the Audit
Regarding the importance of the audit, there are several aspects to contemplate and some of them are:
Make a More Efficient Use of Resources
Auditing helps organizations to take advantage of the resources they have at their disposal to make a profit. This means that in order for a company to be more efficient, it has to implement audits with a certain frequency.
Contribute with Improvements
All this with the goal of achieving greater profit or profitability and contributing with improvements aimed at strategic planning and the achievement of the planned objectives.
Key Points of an Audit
In addition to knowing what an audit implies and the importance of it, a series of elements and instances must be taken into account that allow to obtain the best of the implementation of this method in companies:
1. Planning
Like any activity, auditing requires planning and order. What does this mean? Employees should be aware of when they will be audited. Because, in general, “surprise” audits are not viewed favorably by staff and can generate rejection, as well as resistance to collaborate with the necessary information.
So good planning allows the audit to be perceived for what it is: a great opportunity for teams and the organization as a whole to grow. But this is not the only point that has to be kept in mind.
Also, it requires to bear in mind the importance of doing a review of previous audits, elaborating a previous situation’s status as background and being clear about what the objectives are.
2. Use various sources of information
Another key point of an audit is not just sticking to employee interviews. There are many other sources on which a good volume of information can be obtained. Such is the case of records, area or department reports, statistical software, tools, data analysis…
3. Take advantage of checklists
Now, checklists are a key resource. By the way, we had already told you in another article about what checklists are and which are the main examples of their implementation in companies.
4. Prepare relevant audit reports
In this regard, audit reports should not only reflect which processes are less efficient or that can be easily removed, but they should also provide positive aspects that can still be worked on to make the business more productive.
5. Do not forget the opportunities for improvement
Audits are imperative for teams to detect where they can make adjustments, in order to grow and keep the business growing. In this way, one of the objectives of any audit report is to account for opportunities for improvement, to save time and resources and, therefore, to obtain better results.
Types of Audits
Although there are many types of audits, here we will tell you about the main ones with a basic classification:
According to Who Performs It
Audits can be performed by internal staff as well as external resources.
1. Internal audit
An Internal audit is carried out by the employees themselves, in accordance with the interests and requirements of the company. Its purpose is to find opportunities to optimize internal processes – make them more efficient – and prepare reports that account for growth opportunities and alert about irregularities.
2. External audit
On the other hand, an external audit is carried out by an entity or professional in the field that is external to the company in question. Its purpose usually is, for example, to provide as much information as possible to potential investors or to respond to the concerns of government or state entities.
Would you like to know more about the difference between internal and external audits? Then visit this article!
According to the Objective
Another way to classify audits is according to what is required to be analyzed. For example:
1. Administrative audit
An administrative audit aims to find weaknesses in different areas of the company, in order to correct them as soon as possible through action plans. In this sense, functions are analyzed, new organizational schemes are proposed and the company’s offer is diagnosed in pursuit of customer satisfaction.
2. Financial audit
When it comes to controlling that the accounts and finances of a company are in order, we are talking about financial auditing.
3. Legal audit
A legal audit is an evaluation that is carried out by a legal request, in order to verify the patrimonial status of an organization and its operations.
4. Environmental audit
This audit focuses on the verification of a company’s compliance with the environmental regulations that govern the country.
5. Marketing audit
Audits are also carried out in the marketing world. This way, marketing strategies and processes can be evaluated, based on the objectives and actions implemented, to find areas for improvement that could contribute to a superior performance.
6. Human resources audit
When it comes to evaluating talent management, auditing is an excellent tool. Thus, analyses can be made about the policies implemented with the staff, in addition to addressing other aspects related to capacity-building and training to improve the performance of the teams.
And these are not the only audits that can be conducted in an organization. Discover what type of audit is right for your company.
Related Questions
What Is an Audit and What Does It Consist Of?
An audit consists of the evaluation of a company, either at all operational levels or in a certain area of work, to detect what its strengths and weaknesses are.
What Is the Role of an Audit?
The role of an audit in an organization is to ensure compliance with internal controls, as well as external ones (for example, in case of a legal request). Therefore, an analysis is conducted to see if the operations of an organization are carried out efficiently and according to the parameters provided by it (and the regulations in force).
What Is Audited in Companies?
Through an audit, you can verify how a company operates, how efficient the processes are, if the conditions or requirements established internally and externally are met (for example, in terms of laws), if there are irregularities in financial operations, among others.
What Are the 3 Standards of an Audit?
There are 3 basic rules in an audit. These are:
- General rules: they serve to define the behavior of the auditor in his activity, such as professional capacity and independence.
- Rules on the execution of the audit: the means by which the auditor carries out his work are established, such as planning, gathering information and evaluating.
- Rules on the preparation of reports: with the report, the auditor mentions his opinion on the matter.
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