The audit observation is the most important part of an audit report. It represents the end result of weeks of reviews, analysis, interviews and discussions. It is used to bring significant issues to their attention that needs to be addressed. How well you communicate that information is critical to influencing the readers and getting the results you are seeking. A well-written audit observation will capture the readers’ attention and focus them on the important issues in the report that needs to be addressed.
A well-written audit observation adds value to your clients by providing:
Concise, understandable, and persuasive observations
The key to writing an effective audit observation is having a comprehensive structured process. The Institute of Internal Auditors recommends a process known as the 5Cs:
Corrective Action (Recommendation)
As you develop conclusions, findings and recommendations, you must present them to your client in a logical, complete and objective way. This process provides an easy way to consistently develop and present your observations. The components in this process include all the information you will need to inform and persuade.
Developing this process can be an important tool for completing and reporting observations in a timely and comprehensive way. It allows you to present those findings to your reader in a logical, complete and objective manner and, thus, enhances the chances of the client’s buy-in and their agreement to your recommendations.
This process can also serve as a basis for review by supervisors and managers. It is supported by your work papers and gives complete and clear details of your analysis and the basis for your findings.