Internal audit teams are often an underutilized and underappreciated resource. These teams are hidden gems full of untapped potential. When used to their fullest, IA teams can strengthen a company's error prevention, growth and innovation processes — and even tech implementation.
We've identified five ways that your IA team can enhance your company's activities.
The Day to Day: Risk and Error Prevention
IA teams are fundamental to numerous high-value processes that protect your company's assets. With the proper support for IA teams, activities like error prevention will be a significant driver of company success.
1. Minimize Risk and Ensure Compliance
One of the core goals of an internal audit team is risk prevention. This is a primary function of most IA teams, and its value can't be oversold.
IA teams reduce discovery risks from external audits. Extensive internal audits, done on a recurring basis, will insulate your company from undue exposure — legally, fiscally and even reputationally. Such audits also prevent financial loss and ensure compliance to legal requirements across every arm of the company.
2. Respond To and Prevent Errors
Error prevention is the other side of the risk prevention coin. IA teams are heavily involved in error identification and cleanup for departments like Accounts Payable.
Knowing how toprevent duplicate paymentscan deter significant revenue loss. IA teams know how to prevent duplicate payments by finding those errors and correcting them, bringing money back to the company.
Similarly, IA teams can identifypoints of control that will reduce errors. Unclean vendor master files, for instance, commonly lead to payment errors; an IA team can establish a process for creating vendor files that negates these risks.
The Next Level: Innovation Support
IA teams are generally already involved in error and risk assessment. But many companies don't realize that IA teams will truly drive growth when they are involved in innovation strategies.
3. Enhance and Protect Growth
Companies are always changing, bringing in new people or adopting a new ERP system. These changes happen with the support of the operations side of the business; for successful growth, you need to involve your internal audit team as well when doing this revamping.
Your IA team strives to ensure that risk controls are working as they should within your company. Get your team involved in new processes to that they can set controls from the start, rather than scramble to correct flaws once a change has been implemented.
4. Improve New Process Implementation
In the same vein, IA teams should take part in any major systems implementation you undertake. Before changing your process, IA experts can implement proactive error prevention and test the new system for risk factors.
Take invoice processing as an example. Your Accounts Payable department wants to be more efficient so switches to a spreadsheet system for invoice processing. Without proper testing, that system can spiral into a morass of duplicate payment errors, because no one noticed that the duplicate payment check was lost when the process changed.
5. Identify and Bring in Tech
Because of the IA team's critical role, it should be a significant influencer in technology decisions. Internal audit teams have more visibility into the data and inner workings of your company than anyone else.
As a result, they often have powerful insight into which technology will bring the greatest profit. These tools can range from support systems for internal departments to software like DataShark, which boosts the efforts of the IA team itself.
When you bring your IA team into innovation strategies, you minimize risk down the line and increase the benefits of growth. Your internal audit team already knows how to prevent duplicate payments, which brings essential advantages to your company.
Karl Andersson has devoted his career to helping organizations improve their business processes. For 15 years, he has worked with multitudes of Fortune 500+ companies as the CEO of Technology Insight. Before this, he spent 10 years working in the audit and consulting sectors, which included large international projects in both Europe and Asia.
Karl brings a combination of industry expertise and real-world experience. The diversity of his clients has allowed him to understand a variety of industries, and the unique challenges that each of them face.