Internal auditing teams that want to add the most value to their organizations must frequently go beyond their current practices of overseeing controls, risk, and governance within their organizations. They must also use combined assurance, which can mean the difference between good and great internal auditing.
Valuable Advantages of Combined Efforts
It is important that you continually monitor your operating system and critical data to maintain security and ensure that you are in compliance with state, federal and international regulations. While risk assessment and the internal audit are different processes, with their own individual set of checklists, you can combine them for more comprehensive ERM.
“Both risk assessments and internal audits can lay overlapping claims to risk control, risk finance, data security, fraud prevention, and other components of what’s called enterprise-risk management.”– CFO Magazine
And there are some valuable advantages to combining these efforts
Combined assurance works to unify the goals and activities of the organization in order to gain a comprehensive view of risks and more effective oversight. As a result, the executive committee, audit committee, and board will have a unified and complete understanding of the organization’s risk management efforts.
If the various stakeholders’ tone, language, and messages are well aligned, the focus will become clearer for the entire team. By eliminating or reducing confusion, the security and compliance efforts will be more likely to meet expectations and produce strong results.
Combined assurance assists departments in understanding what related teams are working on in order to avoid unnecessary overlap. This can save time and money, as well as make internal audit findings easier to understand.
Robust risk assessments will help determine which internal audits should be performed and when, as well as the best audit products to use and the required skill sets.
Easier Data Collection and Reporting
Combined assurance can help to simplify the presentation of findings to management and other stakeholders. By minimizing overlap and producing more integrated reports, not only can internal assurance groups reduce their workloads, but they can also reduce repetition that might otherwise make its way into reports.
More Effective Risk Management
Improving coordination via a combined assurance process can also help with risk management. Combining two pieces of a risk assurance puzzle, such as an insight from an internal audit consulting service provider and another assurance provider, such as ERM, can reveal new risk findings that would not have been discovered otherwise, even by an external auditor.
Some departmental overlap will still exist in some cases, but this does not have to be a bad thing. Internal audit and related teams can have more confidence in their oversight with combined assurance. If they see that other assurance providers have reached similar conclusions, whether it’s about reviewing financial statements, identifying key risks, or other assurance activities, they may feel more confident that they’re on the right track.
First, though, it helps for you to understand the finer points of each process before trying to put them together to meet all your needs.
What Is Risk Assessment and Why Is It So Important?
Risk management works through a framework that offers you and your IT professional staff an effective process and methods to follow to achieve your desired results for your organization’s computing system. Basically, risk assessment helps you lurking problems with your company’s information, operations or both, regardless of when an upcoming audit is on the line.
In the most basic sense, you perform risk assessment for quality assurance for your computing system and the data that you and your IT team manage each day. Of course, there are more official, specific and goal-oriented reasons that you need to adhere to strong risk assessment procedures, but it is, in itself, inherently important to helping you keep everything running smoothly.
It might help you to consider some concrete reasons that you and your IT staff might perform a focused risk assessment. Consider a few of the following reasons to help you understand just what it is:
To Justify New Costs.
Whether you want to add new security or hire additional staff, a risk assessment can help you justify the cost to your CEO or budget committee.
To Increase Productivity and Streamline Success.
The more you practice finely tuned risk assessments, the better you can your team become at uncovering inconsistencies and problems before they grow out of control. By creating a review structure and working with your team to embed that structure, you and your team can tend to daily tasks with more confidence, knowing the foundation of your system is in solid working order. Additionally, if you do receive notification of an audit, your hard work on risk assessment will pay off by not throwing your team into a tailspin.
To Improve Communication.
Risk assessment helps you and your team work together better as you form and become familiar with a common operations and information language to keep your system in good working order. This shorthand is another way that risk assessment saves time, energy and resources.
Knowing the reasons you need solid risk assessment is important, but it is even more important to understand the process itself and what you need to examine in risk assessment:
- Identify any risks, as well as risk owners, related to your operating system.
- Assess the possibility risks and their potential impact.
- Explore the level and intensity of risks.
- Include regulations and government laws in your risk assessment to make sure you have covered all updates.
- Make sure to include the following in your risk assessment: a list of hardware and software, processes, policies, procedures, guidelines, repositories, guidelines and security measures.
- Adhere to a series of informational management standards set forth by the International Organization of Standardization (IOS), in cooperation with International Electrotechnical Commission (IEC), to remain compliant with various laws and regulations.
With these considerations in mind, you and your team can keep your operating system and data protected on a daily basis, but you do not need to panic if you know that an audit is looming.
What Does Internal Audit Consulting Mean to Your Organization?
Essentially, an internal audit tests the quality of your risk assessment process. It is a measure of quality assurance that helps you and your IT team unearth errors, inconsistencies and vulnerabilities in your regular risk assessment tasks and approaches.
Additional functions and benefits of internal auditing services might help you distinguish the process from that of risk assessment:
- Understand the overall adequacy of the risk management structure in place.
- Test the implementation of risk assessment processes and the risk management framework.
- Audit management’s commitment to leading risk assessment measures to ensure quality and efficacy.
- Provides an independent and objective view of the risk assessment operations to help the IT team understand issues so they can work to improve them.
All of the findings in each internal audit go to the appropriate review committee for your organization. Finally, you will submit your findings to your internal audit body so everyone can understand the health of your system, as well as your organizational and client information. With an objective frame of mind from everyone, looking toward a continuing effort to streamline processes, you and your IT team can work with your internal audit to continually monitor and improve your results.
Related article: Combining HITRUST and SOC 2 Makes Compliance More Efficient.
Get Help from Industry Experts
If you and your team are still figuring out the fine differences between risk assessment and internal audit consulting services, including the overlapping points, you might benefit from hiring professionals who understand the intricacies of both. Contact I.S. Partners, LLC by requesting a quote to find out more about our services. We can help ease the learning process and help you get excellent results in ERM in the meantime.