Opening ConferencesOpening conferences occur at the initiation of the audit and should communicate the scope of the audit, the audit's objectives, introduce the audit staff, agendas, schedules, and relevant handouts. In part it is an opportunity to explain in professional terms the purpose and expected results of the audit to the employees who are going to be going to be participating in the audit. The entrance conference should be conducted with the following in attendance: Directors, or department heads responsible for the area being audited, managers and their subordinates who work in the specific audit target and any appropriate senior employees.
A typical entrance conference will have an agenda similar to the following:
Welcome
Introduce auditors and related audit participants
Review audit objectives
Review audit steps
Review time schedule
Identify relevant points of contact for each step
Describe the audit process from the auditor's and target's perspective
Set up first contact appointments
Conclusion
Other ConferencesDuring the course of the audit, there will likely be reasons for other conferences. For example, if an auditor finds there is something of a fraudulent nature, this should be brought to the attention of senior managers immediately. This meeting will take place behind closed doors. It is recommended that conferences between the entrance and exit conference take place away from the eyes of employees. If held before employees' view, they tend to foster unwarranted speculation, and damaging rumors can be fomented. Conferences of this type should be scheduled away from the work area being audited. In the case of reporting potential criminal activities, it is strongly recommended that the persons participating in this conference communicate through out-of-band means. Cellular telephones and communications methods, not using the organization's communication networks, are the best out-of-band communications. Involve the appropriate levels of staff including senior managers, legal unit, security unit, and risk managers in all conferences.
One point of professional due diligence is the discussion of the audit findings somewhere toward the end of the audit with the senior managers of the unit being audited. This gives them a chance to see any "hot grounders" headed their way. Responding to the auditor's findings is an effective way of determining if the auditors "hit their marks" with their work. Most senior managers realize their strengths and weaknesses before the audit takes place. Often the audit results merely provide them with the motivation to take corrective action.
An end of audit conference provides a formal means for a meeting of the minds and makes a matter of record of the audit's performance in the eyes of the responding managers. If there are serious differences between the auditor's findings and the manager's responses, it may be the auditors did not have a sufficient grasp of their material or they were not diligent in their efforts. In a worst-case scenario, it could mean the senior managers were out of touch with their business processes. In the former case, it is the responsibility of the audit managers to see that audit team members receive training to bring their skills up to par or find ways to motivate them to diligently perform their tasks.
Meetings whose purpose it is to preliminarily discuss their findings, allow senior managers an informal opportunity to discuss the audit findings and recommendations. This is a useful technique in addressing significant findings and permits the meeting's participants to determine if a follow-up audit is going to be needed.
Usually, follow-up audits are very narrow in their scope focusing entirely on those significant findings of the previous audit. Follow-up audits are much abbreviated, do not have opening or closing conferences and are staffed only with enough auditors to review the findings for compliance.
Exit ConferencesThe auditors have completed their work, the report is done, and it is time to bring the audit to a close. Often, auditors deliver a performance survey to the managers of the target business unit. Such surveys have the purpose of collecting information about the performance of the auditors and the audit in general. Audit managers commonly use these surveys in completing the auditors' performance appraisals.
The agenda below is typical of a closing conference:
Welcome
Review audit objectives
Review audit steps
Briefly review controls adequacy
Briefly review controls recommendations
Present draft report
Field any questions from the attendees
Conclusion
Summary of Audit StepsBy way of summary, here are some steps to successfully completing audits:
Preparation
Predication for audit, routinely scheduled or based on an allegation
Form audit team from qualified employees
Prepare audit management plan
Prepare and deliver preliminary questionnaires
Prepare audit program
Prepare audit budget
Field work
Entrance conference
Audit field work
Audit status conference
Prepare draft of report including senior management responses
Exit conference
Conclusion
Prepare final audit report
Complete audit performance survey
Schedule follow-up audit, if necessary
