The position, tasks, and duties of the particular role or job description in the company would describe the role and responsibilities of an internal auditor. The following points would elaborate on the role and responsibilities of an internal auditor:
Evaluation of risk management
An internal auditor assesses and informs risk management activities within the company. They further recommends risk aversion measures and guide the company in improving the risk management system.
Evaluates control management
An internal auditor evaluates internal control and suggests measures for improvement. During this process, he/she determines the internal audit scope and develops plans for the betterment of the company.
Compliance with laws
An internal auditor reviews whether compliance is made with the relevant laws, rules, and regulations. He/she determines that the dealings of the company are at par with the statutes in order to avoid legal implications and penalties.
Prepare audit reports
An internal auditor should prepare and submit the audit report and audit follow-up from time to time as it determines the status of the company’s governance in terms of finances, operations and administration. He/she processes documents and prepares audit findings memorandum based on the audit reports.
Source of independent advice
An internal auditor acts as an objective source of independent advice in order to ensure validity and legality in the course of working of the company. This helps to cope with the shortfalls in the processes and attain goal achievement of the company.
Promote ethics and conduct
By keeping the business practices of the company in line, an internal auditor promotes ethics, performance standards and sets a code of conduct that eventually becomes a precedent for current and future employees of the company. He/she can also suggest productive strategies for the employees of the company.
Investigate fraud
While evaluating accounting documentation, previous reports, data and flowcharts if the internal auditor comes across a fraud based on the findings, he/she can investigate and perform inquiries on the same in the interest of the employees, stakeholders of the company.
Pursue company’s policies
An internal auditor should thoroughly go through the policies and guidelines of the company in order to plan the course of the company’s governance for the aimed output. He/she should also be up to date with the changing laws and rules so they match up with the guidelines of the company.
Relations between the management and audit committee
An internal auditor should maintain cordial relations between the management and the audit committee. The agenda is to build open communication with them to address issues and solutions for the benefit of the company.
To conclude, an internal auditor performs and controls a full audit cycle, reports concerns to the Board of Directors, and keeps an eye on the core management of the company.