portion of internal auditors’ daily activities consists of conducting
inquiries. When handled correctly, the inquiry process helps auditors to assess
risks, develop audit plans, and prepare their work programs. Moreover,
inquiries often serve as a precursor to observation-based testing and are
integral to the development and communication of corrective actions, as well as
essential in determining whether corrective actions are effective.
importance of inquiry to the audit process, many internal audit practitioners
lack proficiency in this critical skill. For some the challenge may lie in the
art of inquiry, which can take years to master. For others the scientific
aspects of inquiry, which require precision and consistent execution, may
present difficulties. Each component requires significantly different
competencies. When conducting
inquiries, auditors should follow four general process stages: gaining
knowledge, devising questions, making inquiries, and receiving and assessing responses.
Stage One: Gaining Knowledge
inquiry sessions, well-prepared auditors seldom need to ask questions aimed
simply at obtaining general background information on client activities.
Instead, they use their inquiry time to ask relevant, focused questions geared
toward eliciting pertinent information.
inquiries always begin with fact-finding. Whether questions pertain to the
client’s industry, a specific employee, a division’s operations, or products
and services, the more auditors know, the greater the likelihood that inquiries
will be relevant to the process under audit.
Stage Two: Devising Questions
deciding which questions to ask, auditors must consider materiality. There is
little need for an auditor to expend effort on inconsequential issues when
audit resources could be otherwise better deployed. Auditors should assess
specifically what they expect to gain from asking each question and determine
why knowing the answer is important.
developing questions, auditors should try to anticipate possible responses.
Additional questions can then be developed based on those responses to elicit
Stage Three: Making Inquiries
should always treat interviewees respectfully and seek to establish rapport.
Clients are more likely to participate actively in inquiries that are based on
mutual respect, and they become more enthusiastic about sharing knowledge if
they feel comfortable with the interviewer. In addition, if participants
believe they are helping to develop solutions, they may be more inclined to
agree with the auditor’s recommendations.
Stage Four: Receiving and Assessing Responses
is not a passive process. Moreover, there are differences between a good
listener and a good listening interviewer. The former requires attentive
behavior while conversing, whereas the latter requires both attentiveness and
critical thinking. Ultimately, the goal of attentive listening is to understand
the speaker’s responses in a way that is easy to recall. Important skills
include maintaining good eye contact and posture, as well as the ability to
verbally summarize the interviewee’s responses.
THE VALUE OF
are a critical precursor to many phases of the audit cycle. If auditors follow
a systemic method when preparing for inquiries, and use a more intuitive,
nuanced approach to inquiry sessions, the likelihood of an effective overall
engagement will increase.
preparation and a productive inquiry session, however, are only partial determinants
of the interview’s success. If auditors merely complete the questionnaires and
then file them for record-keeping, great opportunities can be lost. The way in
which auditors use the information they obtain is perhaps the most important
part of the inquiry process.