How Do Internal Auditors Benefit Government Organizations?

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Internal audit shops are expensive parts of government organizations. While they do not perform the core functions of their agencies, they support the parts that do by identifying potential and actual . They are the watchdogs who safeguard taxpayer funds and public trust. Internal auditors are often credentialled professionals who have years of experience specifically performing these duties.

In most mid-size and large government organizations, internal auditors conduct annual risk assessments.

These assessments help internal auditors determine where to focus in the coming year. They evaluate where the most potential for waste, fraud and abuse can happen and where the most damage can be done by those nefarious activities.

Financial risk usually drives the risk assessment process, but there are other types of risk. One example is the risk of bad publicity. Elected and appointed officials take this risk very seriously because this risk coming to fruition can spell the end of their employment with the organization.

Internal auditors safeguard public trust by documenting their findings and recommendations in reports that can be readily accessed by the general public, In fact, many organizations post their internal audit reports online for all the world to see. Public release of reports helps hold organizational leaders responsible for acting on the findings and recommendations in those reports.

Final reports often include management responses to findings and recommendations. In these responses, organizational leaders state what they will do in response to each finding and recommendation. In rare cases, leadership rejects a recommendation. When it does, it explains why in the corresponding management response.

For the vast majority of findings and recommendations, leadership outlines precise efforts it will undertake in response.

Internal audit shops follow up on management responses six months to a year later to see to what extend management actions have been undertaken. Sometimes internal auditors write follow-up reports. These reports are public just like the original reports, so leadership has incentive to follow through on what they say they will do in their management responses.

As the saying goes, sunlight is the greatest disinfectant. Internal auditors help ensure fraud, waste and abuse are exposed to sunlight, and they help prevent that disinfecting from becoming necessary.