Audit Preparation

Pre-Audit Planning
Entrance Meeting
Information Request List
During Fieldwork
Issue Management & Resolution
Quality Assurance

An audit can and should be as painless as possible. Most people become anxious about audits because they fear the "unknown", however, the internal audit process is not designed to be a "surprise attack". The audit team works with the audit client during every step of the process to "help improve operations and add value to the organization". Employing the following easy steps can pave the way to a pleasant and productive audit experience:

Pre-Audit Planning

  • As a general rule, departments should always ensure they are doing the following:
  • Reviewing and approving transactions before they are processed
  • Reconciling accounts
  • Preparing documents on a timely basis within the prescribed deadlines/timeframes
  • Filing and retaining documents in an organized fashion consistent with the department's or the organizations record retention policies
  • Segregating duties within a function such that no one person performs all of the procedures from beginning to end within that business process
  • If a unit is doing the above, the audit should run smoothly.

  • Upon receipt of the Notification of Audit, review it, determine a convenient time, and respond to the auditor as soon as possible.
  • Once an agreed upon timing is reached, commit to it. Ensure resources are available to assist the auditors with answering questions, obtaining documentation, etc. The longer it takes to complete the audit, the longer the auditors will be on site.
  • Identify space within your unit for the audit team to work. If space is unavailable, please let the auditor in charge know up front so other arrangements can be made.
  • Entrance Meeting TOP

  • Bring only key personnel to the Entrance Meeting who will have significant direct involvement in the audit (e.g., supervisors, managers, directors, etc.).
  • Ask questions to ensure you understand the audit process, the scope, timing, and any other requirements.
  • Inform the auditor of any potential issues (e.g., operational, timing, resources, etc.). Issues are best handled proactively rather than reactively.
  • Make specific audit requests to review or pay closer attention to areas that may not have been included in the auditor's original scope. This is your opportunity to help design the audit or voice particular concerns of interest to management.
  • Inform the auditor of any blocks of vacation or illness time that may occur during the proposed audit time. If absolutely necessary, the timing of the audit may be adjusted to accommodate the absence of key personnel due to vacation or illness time.
  • Establish a standard status meeting date that is mutually convenient for all parties and commit to a day and time. No one likes surprises. An inform audit client is a cooperative client.
  • Inform your staff of the impending audit and request their full cooperation. Explain the audit process and timing to them so they understand the scope and overall objectives.
  • Designate key contact personnel to interact with the audit team. These individuals should be someone who is knowledgeable about the process and can authorize access to documents and other staff members for inquiries.

  • Information Request List

  • Review the Information Request List and determine if the items requested are available and in what form (e.g., electronic, microfilm, reports, etc.).
  • Inform the auditor if any of the items requested are not available and be proactive at providing viable information alternatives. Again, not providing information is not going to shorten the duration of the audit. The audit objectives must be achieved so working together to find alternatives will make the audit more efficient.
  • Make personnel available to answer questions, provide explanations and documentation.
  • During Fieldwork

  • Attend the status meetings and discuss progress and issues.

  • Issue Management and Resolution TOP

  • Address and resolve issues proactively. This is a very critical aspect of any audit. If issues can be resolved, they will not be identified as findings and documented in preliminary audit report comments (PARCs). Avoid reportable findings by doing the following:
  • Ensure the facts are correct
  • Discuss the issue with the auditor and provide any information that may be critical to understanding the full scope of the issue
  • Obtain supporting documentation to clear or resolve a potential finding
  • If it is decided that the issue is a reportable finding, request draft copies of any preliminary audit report comments (PARCs)
  • Keep your senior management apprised of the audit and any issues that arise. Again, no one likes surprises.
  • Discuss the planned corrective action plan with your senior management prior to writing your formal response to ensure they agree with your course of action
  • Prepare a written response. See How To Respond to Audit Findings for more details.
  • Ensure you have all findings before the completion of the audit.

  • Quality Assurance

    Internal Audit management reviews all audit work papers, findings, and a draft of the audit report prior to the issuance of the final report. During this phase, IA management may identify additional questions or issues that will require some follow up by the audit team. While the audit team may have left your department, the audit is not complete until the final audit report is issued. So please be patient, IA must ensure that every audit is a quality audit that met all of its goals and objectives. The majority of the audit is over once this stage is reached.

    During Reporting TOP

  • Review the draft of the final audit report.
  • Review each section thoroughly
  • Ensure each section is accurate and complete. The findings section should mirror the PARCs you reviewed and discussed during fieldwork with the exception of minor wording changes you've agreed upon with the auditor.
  • Make revisions, if needed, to convey the appropriate wording and tone and give the report "Executive Presence". Remember, the report's audience is senior management and the Board of Governors.
  • Discuss the draft report with your senior management so they are apprised of the issues before they see the draft report. Again, no one likes surprises.
  • Ensure the auditor makes all proposed revisions the report draft.
  • A final report draft is issued to all levels of management.
  • Ensure the auditor makes all proposed revisions the report draft.
  • If no further revisions are required, a final audit report is issued.
  • Share the final audit report with your staff so they are informed about the results of the audit. This also serves as an excellent training and motivation tool for staff to see how their daily work activities impacts the department and the university as a whole.