CIMA Official Learning System P3 — Performance Strategy （7）Internal Audit and the Auditing Process

L EARNING O UTCOMES
After completing this chapter you should be able to:
? Evaluate the process of internal audit and its relationship to other forms of audit.
? Produce a plan for the audit of various organisational activities including manage-
ment, accounting and information systems.
? Recommend action to avoid or solve problems associated with the audit of activities
and systems.
? Recommend action to improve the effi ciency, effectiveness and control of activities.
? Discuss the relationship between internal and external audit work.
7.1 Introduction
The main purpose of this chapter is to identify types of audit, and the role of and need for
internal audit. Internal audit is differentiated from external audit. The chapter describes in
detail the relationship between risk management and internal auditing, different types of
risk and risk assessment in auditing. The audit plan and various techniques for analytical
review are then introduced together with methods of evaluation and reporting the fi nd-
ings of internal audit. The chapter concludes with the ethical principles that are relevant to
internal audit.