In the business world, the word ‘audit’ is often associated with nerves and frustration. However, audit functions are integral to a company’s survival and prosperity. There are two primary types of audits, internal and external. In this blog, we will be discussing why internal audits are important, what they are, and the types of internal audits.
What is Internal Audit?
Typically, an internal audit is a department or an organisation within a company that’s responsible for providing unbiased, independent reviews of the company’s systems, business organisation, and processes.
An internal audit serves as an objective source of information to senior leaders and governing bodies of an organisation about the organisation’s risk environment, control environment, operational effectiveness, and compliance with laws and regulations.
Among other things, internal audits help determine the reputation of an organisation, its efficiency, growth strategy, impact on the environment, and how it treats its employees.
Why Do Companies Have Internal Audit?
Having an internal auditing program in place is essential for monitoring and ensuring that all your business assets are properly safeguarded and protected against threats. Additionally, it is vital for verifying that your documented policies and procedures match your business processes.
Internal auditing holds several benefits, including:
- Providing objective, unbiased insight into your company. This objectivity ensures that nothing is being sugar-coated or ignored due to personal or professional biases.
- Improving the efficiency of your business operations by identifying control recommendations aimed at improving these processes.
- Evaluating potential internal risks and protecting your assets through systematic risks assessments, saving your company time and money.
- Helping to ensure legal compliance in your business processes which can help you avoid fines and gain a trustworthy reputation.
Types of internal audits
A significant portion of the internal audit procedure as a whole is based around financial reporting within a business, the generally accepted accounting procedures (GAAP), and financial statements. However, there is also a need for other types of internal assessments that internal auditors can evaluate. The types of internal audits that we at Customer Perceptions provide are:
- Company awards: To audit your outlets across various metrics for your own internal rewards programme, so that businesses can reward the key players that keep your business running.
- Retail Audits: This is used to audit the availability of products, stock levels, price changes, regulatory compliance and the quality of your date checks. These audits will help companies measure and monitor their retail success.
- Merchandising audits: Takes a look at your presentation and merchandising standards to ensure that the product is positioned to be appealing to consumers.
- Health and safety audits: aimed at assessing and optimising the health and safety standards of operations. Auditors look for hazards and workplace risks that can jeopardise the health and safety of individuals on the premises.
- Pricing audits: Takes a look at a businesses’ planogram and point of sale to determine if the pricing is correct and consistent. This audit will help you avoid missteps within your pricing strategy as you can’t fix problems that you aren’t aware of.
- Promotional compliance audits: It is important to know that products are being promoted adequate during promotional periods. That is precisely why this type of audit is crucial for any business.
- Food and beverage standards audit: This audit will take a look at food and beverage compliance, quality, safety and hygiene, It is important to regularly audit these standards to avoid mishaps or quality failures.
If you are in the retail industry and are looking to audit your business, Customer Perceptions has a several decades-long track record of cost-effective, expert auditing services. At Customer Perceptions, we work with our clients to tailor and design the particular audit criteria appropriate to their business needs. Our dedicated, professional team (with the help of field researchers) can help you measure your customer experience, audit your business, and gather valuable consumer insights. Contact us today for assistance.
