What are the main problems existing in the internal audit of enterprises at present?

1, vague understanding of internal audit function.

Because China's internal audit is the product of an administrative order, an internal audit model that unilaterally emphasizes outward service and exists as the basis of national audit was formed in the early stage. This audit mode actually leads to people's vague understanding of the internal audit function. Today, the internal audit of some enterprises is still difficult to integrate into their overall management, not to mention that many enterprises and their management authorities did not understand or even resist it at that time. As a result, it is difficult to carry out internal audit work normally, let alone perform supervision and evaluation functions and carry out forensic consultation activities, and it is impossible to give full play to its due inward service role, resulting in many shortcomings in internal audit in China.

2. The independence of internal audit in China is poor.

The independence of internal audit is a necessary condition to make internal audit objective, authoritative and fair. The principle of independence is an important sign that internal audit is different from other functional departments within the enterprise. No matter internal audit or external audit, without independence, the audit results are meaningless. The actual situation in our country is that the internal audit institutions of most enterprises are either subordinate to the financial department or merged with discipline inspection and supervision into a regular department, led by the vice president in charge of finance, and only a few listed companies are subordinate to the audit Committee. According to China's "Corporate Governance Guidelines for Listed Companies", although it is stipulated that "independent directors should be in the majority and act as conveners, at least one independent director in the audit committee should be a professional." However, due to the unreasonable ownership structure of listed companies in China, shareholders of listed companies, especially state-owned shareholders, are generally absent, lacking effective constraints on company managers, and "insider control" is serious. The audit committee does not require all members to be independent and wise. Even if the internal audit is led by the audit committee, its independence is very limited. However, foreign internal audit increasingly emphasizes improving the status of internal audit institutions, which shows that more and more internal audit departments report directly to the president or board of directors, and some well-known multinational companies such as Ford, Pepsi, Boeing and so on. There is even a chief auditor at the vice president level.

3. The scope of internal audit is too narrow and participation in enterprise management decision-making is limited. Most enterprise leaders have insufficient understanding of the essential characteristics of internal audit and its functions, and mistakenly think that audit is audit. Although it has improved with the economic development, there is no fundamental improvement on the whole. Up to now, the internal audit of many enterprises in China is only limited to the review of financial accounting, and rarely touches other areas of operation and management, thus making internal audit mostly financial in nature and making internal audit actually a self-examination process of financial accounting. In addition, internal auditors in our country have a wrong understanding of their own functions. They always think that internal audit is to prevent mistakes, focus on evaluation, and pay insufficient attention to audit suggestions. This directly leads many domestic enterprises to lack a comprehensive and correct understanding of the evaluation and consulting services that internal audit can provide. In fact, enterprises need the support and service of internal audit in many aspects, such as system formulation, engineering projects, important contracts, investment decisions, fund use, financial planning and even information system construction. However, many internal audit institutions are often ignored in practical work, or some are given undue responsibilities. In these enterprises, the role of internal audit in strengthening internal management has not been fully or correctly recognized, and the internal audit institution has not been regarded as a whole or a relatively independent part of the enterprise.

4. The auditing technology is backward.

The internal audit in western countries gives full play to its own advantages, vigorously carries out audit investigation, and regularly investigates, evaluates and forecasts the tendentiousness and universality problems existing in the organization, especially the financial and operational risks faced by the organization. Especially since the mid-20th century abroad, the auditing community has developed a variety of auditing sampling methods and techniques, widely used computer-aided auditing software such as acl, and reduced its own work risk by establishing various auditing risk models. However, the internal audit work in China has always been mainly manual audit, and random sampling is carried out according to the personal experience and professional judgment of auditors, and statistical sampling and computer-aided audit software are rarely used, so the risk of audit work cannot be quantified. It is mainly based on post-event audit and static audit, and rarely carries out pre-event audit and event audit, which is not conducive to the audit department to find problems in time, put forward improvement measures and avoid losses.

5. The knowledge structure of auditors is single, and the comprehensive quality needs to be improved. The status of internal audit in enterprises is not high, so it is difficult to attract outstanding talents to join the internal audit team, and it is impossible to complete their own work independently. In particular, Chinese enterprises do not pay enough attention to internal audit, and often put some "old, weak, sick" or difficult-to-place personnel in the audit department, resulting in a considerable number of internal audit practitioners being older and not having the necessary knowledge and professional ability for a long time. In addition, a considerable number of business leaders believe that internal audit is the "error prevention" of financial work, and they are used to selecting auditors from financial personnel, resulting in a single knowledge structure of auditors, especially the lack of risk management and information technology knowledge. This is also one of the fundamental reasons for the above gap in internal audit work. However, all kinds of foreign companies regard the staffing of auditors as a necessary condition for giving full play to their audit functions. Lucent's 75 auditors include 30 MBA and 35 auditors with relevant certificates. The audit department tries to combine everyone's talents with specific projects, and designs a very detailed skill matrix for this purpose, and then uses this skill matrix for the distribution of audit work and the monitoring of personal development.

In short, due to the poor independence and authority of China's internal audit, limited audit scope and backward audit methods, the quality of audit results is greatly reduced. Moreover, due to the auditors' shallow understanding of the audit function and long-term neglect of the follow-up audit work, the audit results can not play their due role, let alone add value to the organization. However, the internal audit in western countries has adopted various methods and developed various technical means to add value to enterprises. For example, Microsoft uses problem manager to solve the problem of audit follow-up procedures. Tools belong to the management department, responsible for the follow-up and solution of problems, tracking the database every quarter, docking with the audit on schedule, and reporting to the audit Committee every quarter. In addition, the audit committee will receive the status reports of internal audit and external audit twice a year. After the problem is solved, the file is archived and can be queried at any time.