What are the functions of internal audit?

The functions are:

(1) Conduct value management. Internal auditors focus on the company's resource usage from three aspects: economy (lowest cost), efficiency (best use of resources), and effectiveness (best results).

(2) Audit of enterprise information systems. Through internal audit, it is determined whether the company's information system provides reliable information for the preparation of statements and whether there is an effective internal control system to reduce the risk of misstatements and omissions.

(3) Carry out project audit. Internal audit audits specific projects, such as establishing new information systems, opening new production and processing areas, etc. Internal audit is responsible for identifying whether the project goals can be achieved, whether the project is running effectively as planned, and summarizing experience from failed project operations.

(4) Conduct internal financial audit. This is the traditional main work area of ??the internal audit department. It routinely checks the financial records and supporting documents for preparing financial statements to reduce the occurrence of errors and fraud; conducts trend analysis on financial data, etc.

(5) Carry out operational audit. The internal audit department can conduct operational audits of operating departments such as procurement, marketing, and human resources, inspect and review the effectiveness of internal controls, and put forward suggestions and countermeasures that can further improve performance and improve management.

The importance

1. Ensure the establishment and improvement of the internal restraint mechanism of the enterprise and the healthy development of the enterprise.

Enterprises in a market economy are subject to the test of endless variables from the market at any time and at any time. The fierce external competition forces enterprises to strengthen management and restrain irregular behaviors. Enterprise internal audit institutions and personnel rely on professional technology and methods.

Through pre-, in- and post-event audits, we can urge enterprises to comply with national financial laws and regulations and corporate rules and regulations, promptly discover internal control problems, put forward opinions and suggestions, and actively serve as leaders and relevant departments. As a staff assistant, prevent and stop the occurrence of violations of disciplines and rules and regulations, or correct and deal with problems that have occurred in a timely manner to ensure the healthy and orderly operation and development of the company's production and operation activities.

2. Prevent business risks and financial risks.

The internal audit institutions and personnel of the enterprise can timely discover existing operating and financial risks by testing and evaluating the degree of perfection of the enterprise's internal control system, and use their professional means to analyze and evaluate the degree of risk. Under the unpredictable market economic conditions, the risk early warning function of enterprise internal audit work can enable enterprise decision-makers and operating managers to take effective measures in a timely manner to avoid operating risks and financial risks, or reduce risk losses to At a minimum, effectively safeguard the survival and development of the enterprise.

3. Strengthen the management of corporate managers and protect cadres.

On the one hand, the internal audit institutions and auditors of enterprises exposed many corrupt elements through audits, which not only purified the team of enterprise managers, but also enabled the majority of enterprise managers to learn lessons; on the other hand, On the one hand, he actively serves as a good consultant and controls financial activities so that relevant personnel, especially business leaders, can avoid or reduce problems or mistakes that may occur unknowingly due to unfamiliarity with financial work;

On the other hand, , the economic responsibility (outgoing) audit of internal leaders of enterprises is increasingly carried out, which not only objectively and fairly evaluates the economic responsibilities of relevant personnel, clarifies their merits and demerits in economic activities, but also provides the personnel department with inspection and use Important basis for cadres

Reference materials: Baidu Encyclopedia of Internal Audit Function