Completing a Internal Audit Risk Assessment

An internal audit risk assessment is an evaluation of risk in which the facts and forecasts are both present and used in the assessment. The potential to forecast an audit can be very difficult to measure but with the help of a graphed and statistical risk assessment you have a better chance of locating a smaller window or risk in general for being audited. The chance of error all depends on how many variables there are present that can be in measured, usually when only by two concepts is great. The factors can be great so it is up to you to place the relevant factors of your risk as you will need to be able to graph what you can in order to help forecast an outcome properly. The risk assessment factors used in selecting audits are designed in conjunction with the objectives of auditing different departments of your business.  In general, these audits would include some of the following for example we use a government office:

• Information Systems Audits
• Internal Control Reviews
• Special Projects
• Follow-up Audits
• Operational Audits
• Financial Audits
• Compliance Audits

Internal Audit Risk Assessment Goals

The common goal for the audit process of risk assessment is to identify and prioritize potential areas which can pose the greatest risk and/or liability to the business. In order to obtain a priority listing of potential audit areas, you must utilized the risk assessment model that takes in the all the potential circumstances in order to rank each of the potential audit areas. You can either work to develop your own risk assessment tool that can conduct a risk assessment or you can look into a template that can help you place all the necessary data in order to conduct the risk assessment as close to factual as possible. Depending on what department you want to audit you will want to check the variables which can include:

• Expenditures
• Financial Exposure
• Funds – Internal
• Funds- Incoming
• Staff and Payroll
• Compliances if applicable
• Management
• Transactions
• Time Period since the Previous Audit

Internal Audit Risk Assessment Variables

All of the examples previously stated are common variables that are seen in a typical internal audit risk assessment. These will all need to be searched and data recovered and reviewed in order to use your risk assessment tool optimally. This should work to optimize your internal risk assessment outcome and if you happen to need or find any other material relevant then you will need to be sure and add it to your risk assessment. All factors will play a role in the audit so be sure to take the time to cover as many as are relevant and possible. Then you can have a more accurate risk assessment. Be sure to document your findings and your process as it can be beneficial in the future if it needs to be reviewed. Internal Audit Risk Assessment