Page 101 - Rižnar, Igor, and Klemen Kavčič (ed.). 2017. Connecting Higher Education Institutions with Small and Medium-Sized Enterprises. Koper: University of Primorska Press
P. 101
Internal Audit in the Financing of Companies
rial or other forms of assets. This can involve money from outside
sources or money from business operations;
• the use of acquired cash (investment) represents the transforma-
tion of cash in non-monetary forms;
• the management of funds, which means the sensible and intel-
ligent use of acquired assets in order to maximise the impact
through earnings or through cash flow, which the company makes
smoother in operation – it comes to ensuring the liquidity and
solvency of the company;
• the return of the funds received (the loan – principal plus interest),
which is the conclusion;
• circular movement of funds which is one of the fundamental tasks
of the financial function;
• allocating financial results, which is allocating business results
expressed in cash at individual participants (owners, employees,
state . . .).
These definitions point to the fundamental importance of the financ-
ing of the company, which is providing the necessary funds at the right
time and ensuring its rational use. For each stage of the financing pro-
cess, we plan internal audit activities.
Planning an Internal Audit
The planning of an internal audit is carried out on three levels. At the
first level, the internal auditor is engaged in the strategic planning of
the internal audit in the company; at the mid-level, it determines what
will be audited and how its capabilities will be deployed in the areas
of auditing; and at the lowest level, planning the layout of their work
within the audit task (Chambers 2004, 56).
The accuracy of the defined areas of auditing and the audit objectives
increases, as far as possible, when we move from strategic planning to
annual planning, However, it is most precise in the planning of indi-
vidual audit engagements. Besides the plans for the interim period, the
responsible internal audit manager, for the revised scope or task, made
an Implementation Plan for the particular audit’s task (Koletnik 2007,
153). It is a detailed plan of works that the members of the internal au-
dit group carried out in a particular audit assignment (Koletnik 2007,
153). As follows from Standard 2200 – Engagement Planning, internal
auditors must develop and produce a plan for each engagement within
99
rial or other forms of assets. This can involve money from outside
sources or money from business operations;
• the use of acquired cash (investment) represents the transforma-
tion of cash in non-monetary forms;
• the management of funds, which means the sensible and intel-
ligent use of acquired assets in order to maximise the impact
through earnings or through cash flow, which the company makes
smoother in operation – it comes to ensuring the liquidity and
solvency of the company;
• the return of the funds received (the loan – principal plus interest),
which is the conclusion;
• circular movement of funds which is one of the fundamental tasks
of the financial function;
• allocating financial results, which is allocating business results
expressed in cash at individual participants (owners, employees,
state . . .).
These definitions point to the fundamental importance of the financ-
ing of the company, which is providing the necessary funds at the right
time and ensuring its rational use. For each stage of the financing pro-
cess, we plan internal audit activities.
Planning an Internal Audit
The planning of an internal audit is carried out on three levels. At the
first level, the internal auditor is engaged in the strategic planning of
the internal audit in the company; at the mid-level, it determines what
will be audited and how its capabilities will be deployed in the areas
of auditing; and at the lowest level, planning the layout of their work
within the audit task (Chambers 2004, 56).
The accuracy of the defined areas of auditing and the audit objectives
increases, as far as possible, when we move from strategic planning to
annual planning, However, it is most precise in the planning of indi-
vidual audit engagements. Besides the plans for the interim period, the
responsible internal audit manager, for the revised scope or task, made
an Implementation Plan for the particular audit’s task (Koletnik 2007,
153). It is a detailed plan of works that the members of the internal au-
dit group carried out in a particular audit assignment (Koletnik 2007,
153). As follows from Standard 2200 – Engagement Planning, internal
auditors must develop and produce a plan for each engagement within
99
