Risk management is a big concern for both audit committees and senior management in corporate internally. Internal audit is an independent management function that evaluates and improves the effectiveness of an organization’s risk management, control, governance, and accounting processes. Internal audit is performed to identify potential risks (such as misappropriation of assets, misuse of funds, frauds, or manipulation of records) an organization may be prone to, managing those risks and reporting on such risk and their management as per statutory requirements.

It is conducted to provide assurance that the management of an organization has the ability to manage risk effectively. It also ensures that governance and internal control processes are operating effectively.

We at Preyas Ruparel and Associates bring to these assignments insights & knowledge of best practices gained from our experience of working through:

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• Identification, evaluation & prioritization of key business & process risks | Mapping of business processes and evaluation of Internal controls.

• Testing of Internal controls for effectiveness using ‘walk-thru’ tests | Recommending improvements in internal controls, business processes & financial reporting.

• Benchmarking with best practices| Review of IT systems | Review for compliance with corporate policies, statutory & regulatory environment.

• Review of effectiveness of managerial supervision.

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Internal Controls are the backbone of any organization. Internal financial controls include policies and procedures adopted by the company for ensuring the orderly and efficient conduct of its business, including regulatory compliance and prevention and detection of frauds and errors, thereby covering not only the controls over reliable reporting of financial statements (more commonly known as Internal Financial Controls Over Financial Reporting (“IFCFR”), but also include all other controls pervasive across the business.

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With adequate and effective internal financial controls, some of the benefits that the companies are experiencing include:

• Enhance governance framework

• Defines clear accountability and transparency

• Controls Automation

• Reduction in number of surprises

• Streamline/standardise controls

• Opportunity to plug leakages/potential frauds

We at Preyas Ruparel and Associates assist clients by undertaking an extensive review of the internal financial control framework, in alignment with the ICAI Guidance Note on Internal Financial Controls over-reporting, which inter-alia includes:

• Gap assessment and testing of Entity Level controls.

• Identification of significant risks and controls for all key processes areas, designing the Risk and Control matrix (manual and automated controls), and mapping of key safeguards with supporting evidence  

• Performing test of design for all identified key controls, assessing the design effectiveness for the same and identifying control gaps and improvement opportunities. 

• Testing the operating effectiveness of internal controls, identification of key deficiencies, and suggesting remediation plans and mitigating controls to address such deficiencies. 

• Training the client workforce to ensure compliance to the IFC framework and building a roadmap for on-going monitoring of the framework through self-assessment and automation. 

While providing the service we also benchmark the client’s processes and controls to industry best practices and offer implementable recommendations.

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