Learning how to write an audit report has some rules. However, they are not as rigid as they might seem to be!
There’s always a good moment to violate the rules regarding writing well. Don’t worry if you cannot include all these in your delivery and your audience requires a shorter report.
You should be able to confidently convey your results as long as you’ve tried to customize the report for your audience and have your in-depth findings ready to back up the report.
Here are the top 10 steps to help you understand how to write an audit report efficiently:
Reference Everything
Citations are essential! Steer clear of unsubstantiated assertions and fill in any blanks with the source of crucial data and numbers. Provide the resources and chance for your stakeholders to investigate and validate your conclusions independently.
Showcase your knowledge of compliance by:
- Citing reputable sources
- Emphasizing audit-proof
- Offering perceptive information
Add a References Section
Ensure to include a reference section in your report to avoid having too many citations and references. Take advantage of appendices to include:
- Official documents
- Local government standards
- Standards from other organizations
A well-organized references section is beneficial even for a single audit report.
Read about the IRS & state audit representation.
Use Figures, Visuals, and Text Stylization
Add images to your report to help you communicate your point more clearly. To bring attention to significant facts and numbers:
- Emphasize the most critical aspects
- Use font styling and color
- Utilize tables or graphs to highlight significant patterns or data.
Contextualize the Audit
In your audit report, provide essential numbers and facts with some context. Financial data presented in isolation sometimes has little value.
You can provide significant value by contextualizing values, such as the amount of a company’s obligations, and demonstrating how they relate to the overall financial condition.
This makes it easier for stakeholders to decide whether to take on more debt or minimize their liabilities.
Share Positives and Negatives
Dispel the myth that audits are always associated with unpleasant news. Add both excellent and negative results, as well as gaps and difficulties. Showcasing the positives motivates teams, processes, and excellent behaviors to keep up their productive work.
Ensure Every Issue Includes the 5 C’s of Observation
Use the five “C’s” of documenting observations:
- Criterion
- Condition
- Cause
- Consequence
- Corrective action plans (or recommendations)
Doing so adequately explains concerns and recommendations that go along with them.
Include Detailed Observations
While keeping your report brief is crucial, some situations call for delving deeper into specific observations or conclusions. Make a ‘Detailed Observations’ section with more information to highlight the higher-priority issues.
Always Perform a Quality Assurance Check
It is advised that an audit report be reviewed several times before being sent to management. For a second set of eyes, look for someone who isn’t directly involved with the audit.
Ask an audited department member to review the report and offer comments. The report should be completed and sent only after the final assessment and consideration of all open comments.
Avoid Blame – State the Facts
Retain a positive rapport with your audit clients by being impartial and avoiding placing blame. Clearly state:
- Issues
- Viewpoints
- Suggested courses of action
Be as Direct as Possible
Make well-reasoned suggestions and demands for action. Steer clear of vague and soft remarks. Readers will appreciate the lucidity.
What Should Be in an Audit Report?
When writing an audit report, content is crucial. The following components should be included in audit reports under IIA Standard 2410 – Criteria for Communications:
Scope and Objectives
Begin by outlining the goals and parameters of the audit. Describe the audit’s purpose, the importance of the audit risk areas to management, and the components the team included.
Outcomes, Recommendations, and Action Plans
Describe the problems identified and suggestions and action plans for every problem identified.
Conclusions
Comment on a broader range of topics and mention the internal auditor’s assessment. This part should be used to recognize the areas in which management excelled.
Wrapping Up
Learning how to write an audit report requires careful investigation, lucid prose, and a well-planned layout. You can write an exciting and educational report by citing your sources. Use graphics and contextualize your results. Outline your advantages and disadvantages. Ensure that everything is well documented. Your results will be appreciated and put to use if you follow professional guidelines and customize the report for your target audience. This will improve organizational performance!
Read More:
What happens during a tax audit?
