How to Write an Audit Recommendation
An effective audit recommendation provides suggestions for correcting problems. It also addresses the cause of issues. Writing an effective audit recommendation involves documenting the details about fixing the current situation and addressing the root cause to minimize or eliminate future occurrences. Business professionals conduct audits to improve operations, validate the reliability of financial reporting and ensure compliance with laws and regulations. Internal audits also evaluate control mechanisms and make recommendations on improving the auditing infrastructure.
Open a new document to write your audit recommendation or download a template. For example, an IT audit recommendation template typically includes a table for each type of control, with headings such as “Area,” “Finding,” “Description,” “Recommendation,” “Manager” and “Deadline for Action.” Creating a table makes it easier to read the information and locate important details, such as completion dates.
For each recommendation, describe the control environment. Assess the risks associated with operations. List your observations about the current situation, including any analysis performed to determine the root cause of problems. Identify the people associated with the issues and any communication sent to them. State the strategy for monitoring the situation. For example, if you discover that duplicate payments occur due to a software programming error, your recommendation should include a directive to have the software developer review the code, fix it, test the new software and release it into production as soon as possible.
Prioritize remedial actions. List the critical actions first. Make it easy to identify what problems need action immediately and which issues can be resolved at a later date. Writing a useful audit recommendation enables a project team to act quickly to resolve problems, reduce costs and ensure accuracy.
Summarize the audit recommendation by providing a description of the outcome desired by the remedial plan. An effective recommendation maintains a balance between the risks identified and the costs associated with controlling problems. Your recommendation needs to clearly define if the recommendation solves the problem, eliminates the issue or mitigates the risk. Additionally, you need to list the resources associated with implementing your recommendation. If additional resources are required, identify the costs associated with locating and obtaining them. Describe the return on investment for implementing your audit recommendation. Your audit recommendation should also forecast the likelihood of the problem reoccurring.