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A risk base internal audit is latest approach to ensure best practices aiming at maximizing the impact of audit by focusing on the major strategy ,regulatory, financial and operation risk that confront an organization while internal audit is traditional independent examination of financial and operation of an organization to ensure economic,effective and efficiency utilization of an organizations resources
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What is meant by audit trail?
audit is an evaluation of a person, organization, system, process, project or product .Audits are performed to ascertain the validity and reliability of information, and also provide an assessment of a system's internal control. The goal of an audit is to express an opinion on the person/organization/system etc. under evaluation based on work done on a test basis.Doing a trial process in audit to make it effective is audit trial.
The Challenge of Internal Audit Jobs?
Internal auditors have the responsibility of making sure that their company's financial records are in order. They evaluate the controls that govern the company's income and expense accounts to make certain they are sufficient. These accounts must meet company and government requirements. Company requirements are based on company policy; government requirements are drawn out through various laws and procedures. Internal auditors must assure that the controls are sufficient to eliminate error or fraud. They prepare the company's tax records for the government. Dealing with overall budgets, internal auditors have also become computer savvy with a handle over the various computer software packages that aid in organizing and reporting accounts. Internal auditors generally have no responsibilities for producing strategy based on accounts or company projections. Internal auditors in the United States become Certified Internal Auditors by passing the Institute of Internal Auditors four-part examination. The examination is based on such topics as risk and control, governance concepts, fraud elements, tools for audit engagement, financial accounting, information technology concepts, and competitive analysis and strategies. After passing the test, the internal auditor must decide in which one of four areas he or she would like to receive a certificate. One can qualify for the Certified Internal Auditor certificate; the Certified Government Auditing Professional certificate; the Certified Financial Services Auditor certificate or receive Certification in Control Self-Assessment. The IIA expects internal auditors to have bachelor degrees and to follow the IIA Code of Ethics. The IIA standards are promoted and recognized across the globe, and many international internal auditors obtain their certification to practice in their countries from the IIT. Internal auditors have a medium salary of $54,000. After experience, the upper levels of internal auditors command $94,100. The number of jobs is expected to increase by 22 percent through 2014. By obtaining an MBA in accounting, internal auditors can reach a much higher salary level. The MBA degree will give the auditor necessary skills to interpret and adapt new laws to their work. Internal auditors have privileged status positions. It is important that they have a good knowledge of the law to protect their access to and knowledge of sensitive and confidential information.
System based audit?
Systems Based Auditing (SBA) was developed during the late 1960s and early 1970s. Before SBA was invented the auditing methods in use were in the main reactive, a prime example is the infamous transaction testing audit method known as 'tick and turn'. Although SBA has been in use for over 40 years, there are still misconceptions about what SBA is. SBA is an audit methodology designed to check upon the adequacy and effectiveness of internal controls in both financial and non-financial systems
Who must establish internal controls based on documented risk assessment?
Assessable Unit Manager
What is the relationship of internal transaction to the adjusting process?
Adjusting entries are not based on external transactions, they are corrections made internally to a set of books
