XYZ Ltd. has appointed PK, to conduct their internal audit for the new financial year. The Audit committee requested PK, to present a detailed report on their findings and areas where immediate action is needed to mitiga

As per Standard on Internal Audit (SIA) 370 Reporting Results, reporting of internal audit results is generally undertaken in two stages: At the end of a particular audit assignment, an 'Internal Audit Report' covering a specific area, function or part of the entity is prepared by the Internal Auditor highlighting key observations arising from those assignments. This report is generally issued with details of the manner in which the assignment was conducted and the key findings from the audit procedures undertaken. This report is issued to the auditee, with copies shared with local and executive management, as agreed during the planning phase. On a periodic basis, at the close of a plan period, a comprehensive report of all the internal audit activities covering the entity and the plan period is prepared by the Chief Internal Auditor (or the Engagement Partner, in case of external service provider). Such reporting is normally done on a quarterly basis and submitted to the highest governing authority responsible for internal audits, generally the Audit Committee. Some part of the aforementioned Internal Audit Reports may form part of the periodic (e.g. Quarterly) report shared with the Audit Committee. Accordingly, a typical internal audit report should include the following: Audit scope and limitation (if any); Audit period Covered; Executive Summary; Summary of the critical findings; Detailed audit findings with elaboration on business impact and root cause of such issues; Rating of the highlighted issues (E.g. High / Medium / Low) in accordance with the rating criteria approved by Audit Committee; Audit recommendation to improve control environment and address the highlighted finding; Response received from the responsible functional authority containing action plan and target timelines for action. A summary of the corrective actions required (or agreed by management) for each observation The fact that an internal audit has been conducted in accordance the Standards of Internal Audit. Nature of assurance, if any, which can be derived from the observations