Internal Audit

Contact Enterslice today for conducting an independent Internal Audit for your organisationto get an in depth outlook towards the internal controls of your organisation.

100000 + Happy Customer

100000 +

Happy Customer

50000 + CA & Lawyers

50000 +

CA & Lawyers

50 + Offices

50 +


Rated at 4.9 By 30000 + Customers Globally

Google Reviews

9,500+ Happy Reviews4.8/5 | 9,500+ Happy Reviews


Rated at 4.8 Rated at 4.8/5 9,500+ Happy Reviews

Navigating Excellence: Internal Audit Solutions for Accountabilitys

The Institute of Chartered Accountants of India (ICAI) lays down the standard for Internal Audit. The ICAI defines Internal Audit as a Risk Management Function that is carried out independently to assist the management of an organisation. This audit is carried out internally at the behest of management and is different from the External or Statutory Audit. Enterslice has a teams of experienced and accredited auditors who have 10+ years of experience in conducting various types audits.

Internal audit helps identify the loopholes and gaps while implementing the organisation's policies and procedures on various day-to-day functions. The audits can be performed in areas related to Finance, Risk, Statutory compliance, etc. It also does checks on internal controls and helps in the implementation of best industry practices for meeting corporate objectives.

What is Internal Audit?

The internal audit evaluates the company's internal controls, including its corporate governance and accounting processes. They help in evaluating compliance with laws and regulations. The internal audits assist in maintaining accurate and timely financial reporting and data collection. It can also be said to be a tool that is necessary to obtain operational efficiency by identifying problems and correcting lapses before they are discovered in an external audit.

The internal audit is required for the following purposes:

  • The increased size and complexity of the business.
  • Compliance with the statutory requirement.
  • Using Information Technology on a large scale.
  • Internal Controls for the purpose of risk management.
  • Establish sound corporate governance and use the best industry practices.

What are the Benefits of Internal Audit?

Internal Audits have many benefits, such as:

  • It protects assets and reduces the possibility of fraud as it keeps a check on the internal control of the organisation.
  • It also serves as an early warning system that enables the organisation to identify deficiencies and apply the remedies promptly.
  • It develops efficiency in operations.
  • It increases financial reliability and integrity.
  • It ensures that the organisation complies with the laws and statutory regulations.
  • The Internal audit system looks at the monitoring procedures.
  • It also helps in reducing the risk of data breaches and several other cybersecurity concerns.

What is the Procedure for conducting an Internal Audit?

An internal audit generally has four phases of activities, such as:


During the planning process, the internal audit team defines the scope and objectives or reviews the guidance related to audits like laws, regulations, company policies, industry standards, procedures, etc. It will also review the results from the previous audits and budget and also set a timeline for the audit. Create an audit plan to be executed, identify the process owners to involve, and also schedule a kick-off meeting to commence the audit.


The actual act of auditing is fieldwork. The audit team will execute the plan throughout this phase. This generally includes interviewing key personnel to confirm understanding of the process and controls. It tests the sample controls over a period of time and Documents the work performed by identifying the exceptions and recommendations.


The internal audit department will draft the audit report during the reporting phase. To avoid any type of misrepresentation, the report should be written clearly and concisely. This is done to encourage the intended audience to actually read and understand the report. The findings should be accompanied by actionable recommendations and must lead to process improvements. The process of issuing an internal audit report must include the drafting report, reviewing the draft with the management to ensure the accuracy of findings and issuance and the final report's distribution.


The final stage is an essential one that is often neglected and overlooked. Following up is crucial to ensure that the recommendations have been implemented to address the identified findings. This process must include the appropriate follow-up with the process owners. It needs to implement recommendations and the Board's oversight of the company's overall status in addressing the findings identified by the internal audit. In case the organisation fails to follow up on the implementation of recommendations, it is unlikely that the changes will be made.

What are the Types of Internal Audits?

A significant portion of the internal audit covers internal controls of financial reporting within the organisation. The organisation must pertain to the generally accepted accounting procedures (GAAP) impacting its financial statements. Many organisations also recognise the need for other types of risk assessments or audits outside of accounting or finance. Some of the critical areas of internal audits are:

Compliance Audits 

Compliance Audits evaluate compliance with the applicable laws, regulations, procedures and policies.

Some of these regulations might significantly impact the company's financial well-being. Failure to abide by some laws and policies may result in hefty fines or also preclude a company from doing business in specific jurisdictions.

Environmental Audits

Environmental Audits assess the impact of the operations of the company. They may also evaluate the company's compliance with environmental laws and regulations.

Information Technology Audits

Information Technology Audits evaluates the information systems and the underlying infrastructure to ensure the accuracy of their processing. The security and customer information is checked in Information Technology Audits. They will generally include the assessment of the general IT controls related to logical access, change management, logical access, system operations and backup and recovery.

Operational Audits

The control mechanisms assess the organisation's control mechanisms for their overall efficiency and reliability.

Performance Audits

Performance Audits keep a check on the goals and objectives of an organisation set forth by the Board of Directors in an organisation.

What can Cause Failures in an Internal Audit?

Internal audit is beneficial to help in restructuring processes, identifying frauds and finding gaps. However, the red flags that can cause failure in an Internal Audit are:

Problems related to the scope

Appropriate planning and meaning of scope are critical to an effective internal audit. With complex frameworks and work processes, it is simple for the scope to grow quickly. It is better to allow the scope to increase and later on realise that you are one step away from auditing the entire organisation and processes.

Not talking to all clients/stakeholders.

It is best to involve clients and stakeholders in the beginning stage itself. It is recommended to go deeper than the teal leads, and the managers also talk with staff, engineers etc. In many cases, the people in trenches might be following a completely different process than what is Documented or understood by the management.

Not reviewing the data.

When the data is required, it is typical to ask the organisation to provide it. The auditor must also clarify if the data provided is accurate and not modified or altered in any way. The auditor must have a meeting with the data provider to understand how the data has been generated directly from the system, along with all the queries or constraints that are used to generate it.

Objectivity and Independence

This is difficult in a smaller organisation. In a large organisation, the internal auditors report to a board of directors or an audit committee. Still, in contrast, in smaller companies, an internal auditor may be reporting to the same person or group they are auditing. The primary key is to stay independent, objective and forward-looking mindset. An internal auditor is basically trying to help and must be allowed to do so, even if the results are hard to hear.

Which Type of Companies are Required to Conduct Internal Audits in India?

The following companies must appoint internal auditors in India:

Private Company 

Every private company has:

  • During the preceding financial year, a Turnover of Rs. 200 crores or more.
  • At any point during the yearOutstanding Loan or borrowing -  Exceeding Rs. 100 crores.

The Outstanding loans here are referred to outstanding loans or borrowings from banks or public financial institutions.

The Central Government can, bye rules, advise the manner and the intervals in which the internal audit shall be conducted and reported to the board.

Who can be an Internal Auditor?

An internal auditor is a person who performs an internal audit. The Internal auditor for the purpose of audit can be an individual, a partnership firm or a corporate body. He/ she can be a Chartered Accountant or Cost Accountant (whether in practice or not) or another professional appointed by the board to conduct an internal audit of the functions and activities of the company.

An employee of a company can also be appointed as an internal auditor, provided that he possesses the requisite qualification and abilities to perform an internal audit.

The Functions of an Internal Auditor are as follows:

  • Review operations, procedures, and policies and also assist the management in establishing better policies and procedures.
  • Certify risks being managed within acceptable limits as specified by the Board of Directors.
  • Examine and evaluate the continuous effectiveness of the internal control system and make proper recommendations, if any, for improving the internal control mechanism.
  • Help the management in identifying frauds and also preventing them.

What are the Activities involved in Internal Audit?

Generally, an internal audit involves the following activities:

  • The Internal auditor will establish and communicate the audit's scope and objectives to appropriate management members.
  • The internal auditors will develop an understanding of the business area that is under reviews, such as measurements, objectives, type of key transaction, review of Documents, and interviews.
  • The internal auditor must describe the basic risks in the business activities that are within the scope of the audit that is to be conducted.
  • The internal auditor must identify the management practices to ensure that the risk is properly monitored and controlled.
  • The internal auditor must develop and execute a risk-based sampling as well as a testing approach to determine whether the most important management controls are operating as planned.
  • He will report the identified issues and challenges and discuss them with management to reach some action plans to address those issues.
  • Lastly, he must follow up on the reported findings at the appropriate time interval to check whether the management has undertaken any efforts. Internal Audit Departments hence maintain a follow-up database with regard to this purpose.

How Enterslice Provides the Internal Audit Services?

  • Enterslice’s Internal Audit and Financial Advisory consultants work with the audit executives, audit committees, and management.
  • We work with companies of all sizes, public or private, to assist them in their internal audit activities.
  • This includes starting and running the activity for them on a fully outsourced basis or working with an existing internal audit function to add the skills that are lacking on the team.
  • The Internal Audit and Financial Advisory team in Enterslice helps clients assess their fraud risks and implement better solutions to manage the risks in a better way in case any irregularities lead to investigations.
  • Our Financial Reporting Remediation and Compliance professionals provide essential functional and project management expertise.
  • We proactively monitor new accounting rules, alert our clients to changing requirements, and offer assistance with addressing complex accounting or reporting challenges, including the latest revenue recognition and lease accounting standards.

What are the Internal Audit Services provided in Enterslice?

The internal audit services provided by Enterslice are as follows:

  • Function Start-Up

    - Through function, the start-up can assist organisations in setting up an Internal Audit function if they do not have one.
  • Risk Assessment and Planning

    – Risk Assessment and planning is a comprehensive scoping and risk analysis. It is used to determine the risk-based internal audit plans that drive the optimal allocation of internal audit resources.
  • Internal Audit Projects

    – The internal audit projects plan, execute and make a report relating to findings and recommendations.
  • Audit Committee/Board Reporting

    – prepare and present Board-level reporting in this step.

Why Should You Take Compliance Help for Internal Audits?

For internal audits purpose, you must take compliance help for internal audits:

  • The auditors are trained and qualified appropriately and carefully selected for their audit skills and customer, benefits focus, and business.
  • Save time, money and internal resources by having an expert work for you.
  • The benefit of having an outsider or independent view of the organisation and the opportunity to bounce off the business ideas of a qualified person.
  • The audit reports the auditors to provide will be helpful and easy to read and understand.
  • The Auditors will follow up on the previous audit results on their next visit.
  • Our Auditors are helpful and approachable.
  • Our audit reports will include the compliance scores that will help in identifying weaknesses and overall compliance with your procedures.

Frequently Asked Questions

The role of an internal auditor is to provide independent assurance that an organisation's risk management, governance and internal control processes are operating effectively. Typically this is the board of directors or the board of trustees, the accounting officer or the audit committee.

The three main types of audits are:

  • External audits
  • Internal audits, and
  • Internal Revenue Service (IRS) audits.

An example of an internal audit: if the management requests a review of inventory management, an internal audit can include testing of inventory controls. In this way, they can provide helpful feedback to management and increase assurance over a key asset category inventory.

The purpose of auditing internally is to provide insight into an organisation's culture, policies, and procedures. It also aids board and management oversight by verifying internal controls such as operating effectiveness, risk mitigation controls, and compliance with any relevant laws or regulations.

The internal auditor shall sight and examine sufficient hard-copy or electronic records to verify; evidence of compliance with the management system procedures; and effective implementation of process and internal control. The organisation needs to ensure the audit is conducted fairly and unbiasedly.

Internal audits are performed to improve the effectiveness of governance and risk management, and control over critical processes. Through internal audits, board management is provided with information and assurance related to their duties.

An internal audit should generally have four general phases of activities. They are

  • Planning
  • Fieldwork
  • Reporting and Follow-up.

The process of issuing an internal audit report must include drafting the report, reviewing the draft with management to ensure the accuracy of findings and issuing and distributing the final report.

The roles and responsibilities of an internal auditor are as follows:

  • Assess the company's risks and the efficacy of its risk management efforts.
  • Ensure that the organisation is complying with relevant laws and statutes.
  • Evaluate internal control and make recommendations on how to improve.

An internal audit offers risk management and evaluates the effectiveness of a company's internal controls, corporate governance, and accounting processes. Internal audits provide management and the board of directors with a value-added service where flaws in a process may be caught and corrected prior to external audits.

There are eight steps to performing an internal audit:

  • Identify Areas that Need Auditing work.
  • Determine how often auditing must be done.
  • Create a calendar regarding the audit.
  • Alert the concerned departments regarding scheduled audits.
  • Complete the preparation.
  • Interview the users.
  • Prepare the results of Documents.
  • Report Findings.

Appointment of the internal auditor is mandatory for every producer company, irrespective of any criterion. However, the Private Company is still required to comply with the requirements of Section 179.

Generally, the time required for the audit will vary depending on the organisation's internal controls' size, complexity and strength. Some take as little as a couple of weeks, and others can take several months.

The internal audit requires an in-depth understanding of the business culture, systems and processes, an understanding and improvement of internal controls for effective risk management, an understanding of the organisation's governance structure and the ability to provide value additions for improvement in governance processes.

Related Services

Our Awards Our Awards

Top 100 Companies in Asia - Red Herring
Top 100 Companies in Asia - Red Herring

Red Herring Top 100 Asia enlists outstanding entrepreneurs and promising companies. It selects the award winners from approximately 2000 privately financed companies each year in the Asia. Since 1996, Red Herring has kept tabs on these up-and-comers. Red Herring editors were among the first to recognize that companies such as Google, Facebook, Kakao, Alibaba, Twitter, Rakuten,, Xiaomi and YouTube would change the way we live and work.

Top 25 in India - Consultants Review

Researchers have found out that organization using new technologies in their accounting and tax have better productivity as compared to those using the traditional methods. Complying with the recent technological trends in the accounting industry, Enterslice was formed to focus on the emerging start up companies and bring innovation in their traditional Chartered Accountants & Legal profession services, disrupt traditional Chartered Accountants practice mechanism & Lawyers.

Top 25 in India - Consultants Review

We partner with more than 100+ companies

-- Testimonials

Don't take our word for it

In the news

Get Started Live Chat