Audit Department
What Is an Audit Department?
An audit department is a unit inside a company or organization that is responsible for assessing operational procedures, risk management, control capabilities, and governance processes. Reporting internally to the audit committee of the Board of Directors and to senior management, the audit department should be totally objective and receive no influence or obstruction from the areas of the company or organization it analyzes.
Figuring out the Audit Department
The chief elements of an audit department are to:
- Decide compliance with policies and procedures
- Survey the quality of internal controls
- Assess the quality of risk management
- Assess compliance with rules and rules laid out by regulatory agencies (e.g., Securities and Exchange Commission)
- Survey compliance with accounting standards, whether issued by the Financial Accounting Standards Board or Government Accounting Standards Board or other
- Survey the effectiveness and security of data technology frameworks
- Survey the strength of the code of ethics and activities to handle infringement
- Give extra oversight to internal accounting rehearses that outside auditors may not zero in on
- Think on the quality of work of outside auditors
- Check physical assets and stock
- Investigate employee grievances and asserted fraudulent exercises
The audit department conveys discoveries from its periodic surveys to management and the audit committee of the Board of Directors. Most are cursory with proposals anywhere to steadily work on the business or organization. At times, the audit department's work is critical in getting to the foundations of a problem that must be extirpated. Models are researching a lewd behavior claim and how customer accounts were hacked. There are cases, however, that make individuals keep thinking about whether an audit department itself is working effectively. Internal auditors at Wells Fargo obviously neglected the fraudulent sales rehearses in retail banking that occurred from around 2011-2016, as per reports. Beginning around 2016, more fraudulent activity has been uncovered in different parts of Wells Fargo.
