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Operational Audit - Coggle Diagram

- - - - Operational auditing is essentially a way of thinking, a method of approach
    - - Operational auditing is no different from internal auditing; it is a simple application of modern internal auditing techniques to all of a company's activities, and is characterized (in both financial and operational areas) by an audit focus and orientation.
  - - - Control Evaluation: It deals with the administrative controls that are exercised over all phases of the business, and its purpose is to determine whether the established controls are adequate and whether they are effectively fulfilling management objectives and its operational plans.
      - Performance Evaluation: When evaluating performance, the auditor typically refers to the quantitative information contained in the report to measure the effectiveness, efficiency, and economy with which the work was performed. He or she will address performance in areas such as personnel, labor, productivity and quality of work, and cost.
      - Management Assistance: The primary objective is to assist managers and directors at all levels of the company. In auditing management operations, deficient conditions are often observed. Most often, these are unavoidable due to a violation of the fundamental management principle.
  - - - By competence; for a company to be competitive in the commercial arena, a more specific audit must be conducted to identify or detect its strengths and weaknesses, and thus overcome them through the auditor's information and recommendations.
      - By senior management; the company's senior management needs to identify areas of greatest sensitivity and contribute to greater operational efficiency, the purpose of which is to ensure the efficient, effective, and cost-effective fulfillment of business objectives.
- - - - Coherence
      - Adequacy.
      - Compliance
- - - - Information Gathering
      - Legal Framework
      - Organization
      - Operations
      - Financing
      - Control
      - Additional information
      - Features: It doesn't require a detailed reading of information or manuals.
        It's a rapid process of gathering written information and interviewing officials.
  - - - Minimum Activities to Understand the Audited Entity:
        
        Determine why the public entity, organization, or company was created. What was the need for its creation and the purposes or objectives that guided its creation.
        
        Determine whether the initial objectives have changed over time.
        
        Clearly determine the primary mission of the public entity, agency, or company and what the main objectives are for achieving the primary mission.
        
        Determine the operations or activities of importance to achieve the main objectives and purposes of each activity.
        
        Review only documents that contain general provisions regarding the entity's operations.
  - - - To carry out this type of audit, it is necessary to reduce the number of operations or activities of the entity to a number that can be reasonably measured in terms of effectiveness, cost-effectiveness, and efficiency within a reasonable time, generally four to six months, with a group of no fewer than five qualified auditors.
    - - Developing objectives, measuring results, comparing current or actual performance with proposed objectives and goals, analyzing the causes of various deviations, determining appropriate management action, taking action, and conducting ongoing review.
    - - Based on the results of this evaluation, the auditor will identify weak or critical areas, which are those that present internal control weaknesses, and will select those of greatest relative importance and that meet the necessary conditions to direct operational audit efforts toward them.
- - - - The operational auditor should communicate the results of his or her examination verbally during the fourth stage to obtain the perspective of the company's officials and to discuss the audit findings with them.