Importance of Internal Audit Increasing Efficiency in the Public Sector
Importance of Internal Audit Increasing Efficiency in the Public Sector

Author(s): Jonida Bekteshi
Subject(s): Economy, Accounting - Business Administration
Published by: Университет за национално и световно стопанство (УНСС)
Keywords: internal audit; auditors; public institutions; default; public sector
Summary/Abstract: A very urgent requirement today is the need for an effective internal audit service as public sector organizations have a responsibility regarding the delivery of public services and the use of public funds which makes the requirement for transparency more and more growing. Regarding the transparency of financial statements, auditors are playing an important role in the modern global economy as with the implementation of the audit of financial statements, their reliability is increasing by helping users of financial statements to have an easier and fair decision. As the audit process prevents and detects fraud and errors, its role is to increase the quality of financial reporting in accordance with International Standards. According to the standards, auditing is defined as an independent activity that provides objective assurance and provides management advice designed to add value and improve the activity of the public entity. It assists the public entity to achieve objectives through a disciplined and systematic activity to assess and improve the effectiveness of risk management as well as control and governance processes. An audit is a process of verifying management statements contained in the financial statements in order to accurately reflect the information contained in those statements. The framework on which the audit should be based should be sound and logical enabled by International Standards on Auditing, which have a global impact on the audits performed. They contain the basic principles and necessary procedures applied during the audit. Financial statements as well as explanatory notes and other materials provide guidance for their application. Nowadays, in addition to evaluating financial activities and preventing fraud and errors, internal audit also includes reviewing and evaluating the operating activities of the entity and help increasing the efficiency.

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