Rethinking Internal Audit Reports: Streamlining Communication for Greater Impact

Compliance blogger Norman Marks challenges the necessity of writing detailed internal audit reports, questioning their true value to the organization. Unlike other departments, internal auditors produce extensive reports, a practice often justified by tradition or compliance with IIA Standards.

Marks argues these reasons are weak, emphasizing that reports should provide value proportionate to the resources spent creating them. The IIA Standards require “communication” of audit results but do not mandate traditional reports, while Standard 15.1 is overly prescriptive, suggesting concise, tailored communications instead.

Management and boards might expect detailed reports out of habit rather than need. Many senior managers and board members do not read entire reports, often delegating this task or ignoring the content unless it’s crucial. This raises the question of whether traditional reports are the best method to drive action or communicate important issues.

Marks suggests alternative communications, such as memos confirming discussions from closing meetings, regular quarterly meetings, or open discussions post-audit. These methods can provide necessary information more efficiently and effectively. The focus should be on concise, actionable communication that directly addresses the needs of senior management and the board.

Ultimately, the author advocates for a critical reassessment of why and how internal audit reports are produced. The goal should be to deliver essential information in a manner that saves time and enhances credibility, ensuring the organization receives the assurance, advice, and insight needed without unnecessary bureaucracy. This approach fosters greater trust and effectiveness in internal audit functions.