Abdulaziz bin Mohammed Al- Kanhal, an expert in the internal audit and financial functions and consulting, said that institutions need to "internal audit function", which reaches the necessary stage, as it gives departments an assessment and assistance to achieve the objectives that required of them according to a scientific approach and the application of laws and regulations, which contributes to increased efficiency of performance and effectiveness evaluation, reduce the likelihood of fraud and fraud, reduce the occurrence of significant errors, and thereby reduce risks to achieve strategic objectives.
This came in a lecture entitled, "Internal Audit from my experience according to international standards (IIA)" that was organized by Asharqia Chamber on Tuesday March 26, 2019 at the Chamber's branch in Jubail Industrial City.
Al-Kanhal said that the review is "an independent activity (assessment and objective) that provides assurances in order to add value to the organization and improve its operations and help achieve its objectives through systematic method to assess and improve the effectiveness of risk management processes and governance."
He explained that this process is in accordance with the International Auditing Standards IIA, which is accredited by the Saudi Association of Internal Auditors, ethics and rules of conduct (confidentiality, integrity, objectivity, efficiency).
In this regard, the internal audit is carried out according to the following sequence, "Planning, implementation, report, follow-up, improvement of effectiveness."
He believes that the effectiveness of the results of the internal auditors' work is always positive for many reasons, notably: relying on the mechanism of work (internationally approved standards) that leading to raising professionalism in the work of the different departments of the facility, the internal audit staff have professional and scientific qualifications and experience to perform their duties, because they enjoy the statutory independence that gives them the performance of work objectively and they do not share executive functions, and therefore their recommendations are more neutral.
He added that what gives the auditors confidence that the results of the audit work depends on the evidence is documented can be consulted to verify, because audit standards emphasize an independent entity periodically that reviews the internal auditors' working papers and provides an assessment of the adequacy of the application of the standards, especially as audits are based on risk assessment and analysis in prioritizing its schedule of tasks.
In order to detect or reduce fraud as one of the most important objectives of the audit, the lecturer stressed the importance of planning a good review process, the use of qualified staff, providing appropriate knowledge of the types of fraud and fraud potential by activity, assessment of the level of control and the most important risks and potential fraud, taking appropriate samples to verify and work the necessary procedures to reach accurate results, using appropriate technical tools to assist in screening, analyzing and comparisons, reporting results to the appropriate level, and following up appropriately with appropriate levels.
He pointed out that one of the methods of fraud is the theft of goods from the warehouse of warehouse custodians or employees, and not to deposit receipts from customers and keep them, then write off the account on the grounds that it is not collectable, not to deposit money in the bank on a daily basis or to deposit part of it only, and to bring several quotations close to the knowledge but the price is higher than the market (procurement officer), the signing of the receipt of purchases that has been made but has not been effected (the petty cash covenant), modify the data in the warehouse records to conceal the deficit, selling the damaged items and taking their price personally.
Among the indicators of embezzlement, Al-Kanhal cited some of the positions issued by the employees who confirm this suspicion, such as "refusing to give up records to an alternate during the leave, the refusal to obtain leave, delay delivery and official receipt, not to provide information to the alternative employee in respect of suppliers or customers, the presence of signs of luxury on the employee more than the level of salary or family level, weak employee ethics and boast of his indifference to regulations, and receiving valuable gifts from suppliers or customers, be uncomfortable when asking reasonable questions.
He concluded that the audit was a fundamental part of the organizations' progress.
