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How Internal Auditing Can Bring Value to Your Organisation

07 January 2025
8-minute read

Learn how internal auditing drives better decisions and stronger outcomes.

The benefits of internal auditing

Understanding how to maximise the benefits of internal audits can be complex, especially for those unsure of the right steps. In this article, NQA’s Training Manager, Dr Charles Beacroft, shares his experiences on how internal auditing, when done correctly, can bring immense value to your organisation.

What is internal auditing and what does it achieve?

Internal auditing is defined as a systematic process to evaluate the effectiveness and compliance of an organisation's management system against the relevant standard. These audits are carried out by the organisation on its own systems. Internal audits are one of three types of audits that can be conducted on ISO management systems, with internal audits (also known as first-party audits) being the focus here. The other types of audits are supplier audits (second-party audits) and external audits (third-party audits), which are typically performed by an independent body for certification purposes.

An internal audit seeks to ensure organisational conformity with a variety of requirements, including adherence to the appropriate ISO standard, the organisation’s own management system, business contract obligations, certification body requirements, and compliance obligations.

To achieve this, an internal audit draws upon multiple inputs to accurately evaluate the relevant requirements. These include defining the scope of the audit, reviewing previous internal and external audits, considering all contract requirements and compliance obligations, as well as assessing the relevant standards and the organisation’s management system.

During the audit itself, internal auditor(s) will observe the operation of relevant processes within the organisation. They will collect objective evidence through interviews with employees, observations of organisational areas, document reviews (such as procedures and policies), and sampling of processes to form a representative basis for evaluation. This evidence will then be assessed against the criteria, including the standard and management system requirements.

The internal audit findings will be presented to the auditees, highlighting both areas of excellence and concern. Nonconformities are raised when objective evidence suggests that controls or requirements are insufficient to ensure that the organisation’s products and services consistently meet the required standards.

Each nonconformity presents an opportunity for the organisation to take corrective action, eliminate the cause, and prevent recurrence. Root cause analysis is used to identify and resolve the underlying causes of problems, thereby preventing them from happening again.

The value of internal audits

Now let’s explore some of the key reasons why internal audits can bring immense value to any organisation:

Health check: Internal audits are often viewed as a ‘health check’ for an organisation’s adherence to the requirements of the relevant ISO standard. They assess conformity against the organisation’s own management system and all contractual and compliance obligations. Without these health checks, organisations risk failing to meet requirements, which could lead to the loss of certification. This, in turn, may significantly impact the business model, especially for those dependent on certification to engage with clients, suppliers, or other stakeholders.

Continual improvement: Internal audits foster a culture of continual improvement by providing a comprehensive review of processes, identifying nonconformities, and suggesting amendments that enhance the management system. Given that continual improvement is a core principle in many ISO management systems, internal audits play a vital role in implementing and maintaining a robust management system.

Change management: Internal audits allow for positive, proactive change within an organisation, particularly when such change is necessary to drive improvements. While change can be challenging, embracing it helps create an organisational culture of continual improvement. This benefits organisations that adopt change compared to those that resist it.

Business understanding: Internal auditors often possess a deep understanding of their organisation, particularly the internal and external factors that impact the business. This nuanced knowledge allows auditors to optimise the management system, tailoring it to meet the needs of the organisation.

Organisational steps for the effective use of internal audits

To ensure that internal audits and auditors deliver the maximum value to an organisation, there are several steps that organisations—especially leadership—can take to enhance the process. These include:

Top management support: for an organisation to implement and maintain a management system in line with the ISO standard, top management must demonstrate strong support. This commitment ensures that internal auditors can carry out their work effectively and allows leadership to collaborate with the auditing team to review the system’s effectiveness. Additionally, top management plays a crucial role in fostering a culture of continual improvement, with internal audits being a fundamental part of this process.

Experienced and knowledgeable auditors: having experienced and knowledgeable auditors ensures that the audit process is both efficient and effective. Internal auditors who understand both the organisation and the sector in which it operates are particularly valuable. Organisations must invest time and resources to ensure that their auditing teams are sufficiently competent, which includes ensuring auditors undertake adequate training to meet the ISO 19011:2018 requirements.

Collaboration with employees: one common challenge internal auditors face is resistance from employees or teams during the audit process. This resistance is often due to a lack of understanding about the audit’s purpose or reluctance to have processes reviewed by others. Internal audits aim to support, not hinder, the organisation by evaluating the implementation and maintenance of its management system. To address such challenges, auditors should engage clearly with all employees or teams being audited, communicate the goals of the audit, and emphasise how the audit contributes to the culture of continual improvement within the organisation.

Conclusion

We hope this article has helped you understand the value that internal auditing can bring to your organisation. If you are interested in becoming an internal auditor or want to ensure your internal auditing team has the necessary competence in line with ISO 19011 requirements, please explore our ISO internal auditor training to find the perfect course for you or your colleagues.


 
For further information on internal auditing, please check out our recent NQA webinar on the subject.


For more information or to discuss how we can assist with your training needs, reach out to our friendly training team today!