The final Considerations. Preservation of data is important for the eventual resolution of any embezzlement or fraud case and for the fair and ethical treatment of any business employee. Just as data can be changed to destroy the integrity of the evidence, data can be inadvertently changed and destroy the integrity of the process, potentially leading to false accusations.
The Final Considerations
If an employee is accused of a crime based on a date and time stamp on a file accessed and reviewed by an internal auditor before law enforcement was called, the consequences to the business and the employee could be devastating.
Internal auditors and staff should plan to meet with human resources personnel regularly to keep abreast of relevant employment laws, rules, and regulations. This knowledge will be helpful if the company begins discussing such issues as reviewing e-mail or other possibly personal information on users’ computers or even requiring a polygraph for continued employment of a suspect.
In such a case, it will be necessary to know the rights and responsibilities of the company and the employees.
Internal auditors should also become familiar with company policies regarding individual privacy expectations. It is worth knowing that an internal auditor’s time to ask human resources personnel if employees are required to sign an acknowledgment when hired, giving them notice that all e-mails and documents contained on the company computers are subject to search, as necessary. An auditor can suggest this as necessary to protect the company in case of an investigation that may require the company to search the employee’s hard drive or e-mail if this is not part of the standard paperwork for new hires.
Understanding An Internal Auditor (IA)
An internal auditor’s (IA) primary responsibility is to identify and correct problems before they are discovered during an external audit by an outside firm or regulatory agencies such as the Securities and Exchange Commission (SEC). One of the SEC’s responsibilities is to regulate how companies report their financial statements in order to ensure that investors have access to all relevant information before investing.
Internal audits typically carry out the three tasks listed below.
- Examine any risks and internal controls within a company.
- Ensure that a company and its employees are abiding by federal and state laws and regulations.
- Make recommendations on what should be done to correct a failed audit or issues identified as problematic during the audit.
Internal auditors typically perform a variety of tasks to achieve this goal, including examining financial statements, expense reports, inventory, financial data, budgeting and accounting practices, and creating risk assessments for each department. To eliminate potentially damaging errors or falsehoods and find ways to boost productivity, detailed notes are taken, interviews with employees are conducted, work schedules are supervised, physical assets are verified, and financial statements are scrutinized.
Final Thoughts
Despite the fact that they are not legally required to do so, many businesses choose to hire an internal auditor. Internal audits are viewed as an important way to quickly correct issues, maintain a good reputation, and avoid wasting money. Internal auditors reports can help businesses thrive and operate at peak efficiency. Internal auditors also prepare the company for success when the annual external audit arrives. An internal auditor’s job is essentially to help catch and fix problems before an external auditor can. As a result, many executives regard them as a necessary expense.
