Audit findings are the results of an audit. In a financial institution, bank audits must be carried out routinely to determine if the bank is following industry best practices, legal and regulatory requirements, and their own bank policies. After the bank auditor completes its audit, it presents audit findings to communicate what it has discovered and its recommendations for improvement.
The audit findings are based on evidence about how the bank’s operations measure up against the audit criteria. The audit criteria are outlined in a document that auditors use as a guide for conducting their examination of the bank’s processes and procedures. It includes the bank’s plans, policies, procedures, and the requirements it must meet.
Audit findings can show either conformity or nonconformity to the audit criteria. In cases where the bank is operating appropriately, the finding is that it conforms to the standards set out in the criteria used to evaluate it. However, if bank processes and procedures are not adequate or appropriate, the finding will be that the bank or some of its functions are nonconforming.
For each issue that needs to be corrected, a finding of nonconformity details and relays that information so that the bank can take corrective action. Through audit findings, the financial institution receives information about how well it is functioning on a daily basis and how it is strategically positioned to move forward.
It is preferable to discover items that need to be corrected before they are discovered by a regulator and written up in a finding. To do this, banks need to monitor the findings they receive, assign tasks for resolving issues communicated through findings, identify areas for improvement, report the findings to people in positions of responsibility, and deal with accountability issues. Findings management software can be used to do tasks such as these to improve audit findings in the future.
Audit Management Resources
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