In our previous blog post, we dove into the various types of audits, first focusing on external audits. Today, we’ll turn the spotlight to internal assessments and give you some helpful tips on conducting these worthwhile exercises.
An internal assessment is review of your organization’s financial and operational practices to identify any potential areas of concern. Conducting a self-assessment may seem overwhelming, but it’s a crucial step for your organization to ensure compliance with regulatory requirements and identify potential areas of concern. Here are some steps you can take to conduct a self-assessment.
Identify the Purpose and Scope of the Assessment.
The first step in conducting a self-assessment is to identify what you want to learn, which will help define the scope of the assessment. This involves determining which areas of the organization will be reviewed and what specific goals and objectives the assessment will have. The scope of the assessment will depend on your organization’s size, complexity, and the areas of your organization that you are putting under the microscope.
Gather Relevant Documentation
Once the scope of your self-assessment has been identified, you should gather all relevant documentation related to the areas being assessed. This could include financial statements, contracts, invoices, receipts, and other relevant records. It’s important to ensure that all documentation is up-to-date and complete to help ensure an accurate assessment.
Review the Documentation
With all the relevant documentation in hand, now is the time to review it to ensure that it’s accurate and complete. Look for anything that may require further investigation. Pay attention to areas where mistakes or errors have been made in the past, or where there have been concerns raised by internal or external parties.
Identify Potential Areas of Concern
Based on your documentation review, now you can identify any potential areas of concern. These could include areas where there is a risk of fraud, or where there is a lack of compliance with regulatory requirements. It’s important to be unbiassed when identifying potential areas of concern and to look at the documentation as objectively as possible.
Analyze the Results
After identifying potential areas of concern, you should analyze the results to determine the root causes of any issues. This could involve interviewing your employees or reviewing your organizational policies and procedures. It’s important to understand why these issues exist and what can be done to address them.
Develop an Action Plan
Based on the results of your self-assessment, you can now develop an action plan to address any issues or concerns that have been identified. This could involve developing new policies and procedures, implementing new controls, or providing updated training to employees. The action plan should be specific, measurable, achievable, relevant, and time-bound.
Implement the Action Plan
Finally, you need to implement the action plan and monitor its effectiveness. It’s important to ensure that the changes made as a result of the self-assessment are implemented effectively and that they address the issues or concerns you identified. Monitoring the action plan’s effectiveness will also help ensure that your organization remains compliant and that any potential areas of concern are addressed.
We’re Here to Help
Conducting a self-assessment is an important process to ensure that you remain compliant and that your financial and operational practices are effective. By following these steps, you can identify any potential areas of concern and address them before they become more significant problems.
By regularly conducting self-assessments, you will help ensure that you remain compliant and that your practices are effective, which can improve your business’s reputation and minimize the risk of fines or penalties.
Just because it’s a self-assessment, doesn’t mean we can’t help! Contact Abacus today to see how we can help you design a self-assessment for your organization or conduct one on your behalf!