You've discovered internal oversights. How do you address discrepancies found by external auditors?

Acredito que o primeiro passo é analisar os relatórios com profundidade, seriedade e sem melindre. é fundamental identificar se foi um erro ou fraude. Gosto muito de pedir ajuda para as áreas de auditoria interna e compliance. Identificando que é um erro é importante fazer uma revis?o nos controles internos com o intuito de mitigar as possíveis falhas. Uma quest?o que pode contribuir muito para reduzir este tipo de situa??o é ter uma boa formaliza??o dos papéis de trabalho com revis?o do superior e fazer rota??o de atividades, visto que as pessoas que executam, podem ter vícios e n?o perceber. Agora se for fraude é importante identificar os responsáveis e demitir imediatamente, tomando todos as precau??es necessárias.

Identifying the real problems & overall impact basis high level findings of an external auditor is the most essential step. External auditors use sample testing in most of the cases and any such indication may lead to a larger problem. Acknowledging the problem, followed by a root cause analysis and impact assessment will already bring us closer to the corrective measures and potential solution. Materiality, Risk category, frequency of discrepancy and key contributing reason are a few indicators to help us with an effective course of action.

Once some findings are identified and presented by the auditors, the company has to start dealing with them in order to solve the issues. First of all, it is necessary to evaluate the risk of each finding can cause to the company, and then follow the next steps: 1) prioritize the resolution of each issue based on its risk; 2) develop an action plan with timelines and responsibilities for each task; 3) monitor and follow-up the execution until is completed. I did this several times during my career and worked well. My experience as an auditor also contributed to speed up the process of addressing the issues and solve them.

Check the problem and acknowledging it, by a root cause analysis and impact assessment will already bring us closer to the corrective measures and potential solution

Discovering discrepancies through external audits requires a swift, transparent response. First, promptly engage key stakeholders, including HoDs, management, and the audit committee, to discuss the findings. Clearly communicate the nature of the discrepancies with potential impact. This open dialogue helps clarify misunderstandings and fosters a collaborative approach to resolving issues. Next, develop a comprehensive action plan, assigning responsibilities and setting clear deadlines. Continuous monitoring and regular updates ensure effective resolution. Finally, document all actions and consider training programs to prevent future oversights. This proactive, transparent approach maintains trust and strengthens organizational integrity.

Stakeholders and board should carefully review the discrepancies highlighted by the external auditors to determine if they are isolated or systemic issues, and focus on improving our processes rather than assigning blame.

Form a team comprising key personnel from the finance, internal audit, and relevant operational departments. This team will be responsible for investigating the discrepancies and implementing corrective actions.

Internal Communication by informing the key internal stakeholders about the findings and the potential impact of the discrepancies findings. External Communication this will be depending on the severity of the discrepancies, you might need to communicate with external stakeholders, such as investors or the regulators body.

Provide a report to key stakeholders, including the board of directors and senior management, detailing the discrepancies, actions taken, and the current status. This report should also highlight any changes made to internal controls or processes.

Based on the internal review, create a detailed remediation plan that outlines the steps needed to address the discrepancies. This plan should include specific actions, responsible parties, timelines, and any necessary resources.

Corrective actions by addressing the discrepancies and define the specific actions to prevent any future reoccurrence. Set a timeline for implementing corrective measures. Take the responsibilities or assign to department and team members to take action and implement the new actions with the issues.

Developing a comprehensive action plan is essential after identifying issues. This plan should specify corrective measures, such as adjusting journal entries or strengthening internal controls, and assign responsibilities to ensure accountability. Timelines should be set for each action to track progress. Beyond addressing current discrepancies, the plan should include long-term solutions, such as staff training or procedural revisions, to prevent similar issues in the future. This approach not only resolves existing problems but also helps build a more robust and resilient system.

The purpose of the external audit is to review our operations to identify process improvements so that our figures accurately reflect the current and real situation of the company, that’s why we must create a remediation plan to address the various findings.

To ensure consistency in the improved control we should not rely in a Quick win solution and instead develop a comprehensive action plan based on a robust Root Cause Analysis which allows us to identify if the issue was caused by a breach in the process, performance or monitoring.

Execute the corrective actions as per the response plan. This may involve adjusting financial records, revising policies, enhancing internal controls, or providing additional training to staff.

As a human being it is very common to make a mistake We should always rectify our mistake as soon as possible . When we find discrepancies in audit reports , we have to rectify that in our records . If we are not agree with some discrepancies then we should come in to notice to our auditor with data & proof . Our quick activeness to change in wrong statement creates a good image in the mind of our shareholders , lenders , customers . Thus ultimately it will reflect in our business growth .

Execute the remediation plan by making the required adjustments to financial records, improving internal controls, and updating policies and procedures. Ensure that all actions are documented and communicated to relevant stakeholders. Strengthen internal controls to prevent future discrepancies. This may involve introducing new checks and balances, enhancing employee training, and employing more rigorous oversight mechanisms.

Implementing corrections is a fundamental initial step to stopping the problem. The use of methodologies such as 5W2H and PDCA are essential tools for correcting and evaluating a company's internal improvement projects. Having the steps mapped out with those responsible and the respective actions helps sectors monitor and measure metrics.

Deficiencias presentadas por los Auditores Externos; deben ser tratadas desde un marco de mejora continua siempre y cuando no afecten la razonabilidad de las cifras presentadas en los Estados Financieros. Si afectaran los resultados presentados en los Estados entonces deben aplicarse medidas de consecuencias y atender urgentemente las debilidades reportadas. Los Estados Financieros de una organización no pueden verse expuesto a dudas porque limitan la entrada del negocio a financiamientos; si es una empresa pública que cotiza en bolsa afectan las inversiones y podría bajar la cotización de los instrumentos que se negocien en esos mercados .

Regularly monitor the implementation of corrective actions and report progress to senior management and the external auditors. This helps in maintaining transparency and accountability throughout the process. Arrange for a follow-up audit to verify that the discrepancies have been resolved and that the improved internal controls are effective. This step is crucial for regaining the confidence of stakeholders and ensuring ongoing compliance.

Monitoring the progress is an ongoing and rather a dynamic task. Since each phases of the work is expose to a unique set of challenges and risk.As much we progress on any particular project we need to apply a greater level of vigilance and precautions to get the desired results that too well within time. Even a minor variance in terms of quality at any stage of work progress could result in the total failure or may compromise the workable life of the project or may result in a sudden collapse.Monitoring the progress requires a perfectionist level of quality that is required to be used from the very start of any project till its final stage of completion and sometimes during its initial stage of implementation to ensure most anticipated end.

In cost accounting, discovering internal oversights before an external audit can be crucial. Addressing these discrepancies involves a thorough review of the financial records, identifying the root causes, and implementing corrective actions to enhance internal controls and risk management processes. It's essential to communicate these findings transparently with external auditors, demonstrating a commitment to accuracy and compliance in financial reporting. This proactive approach not only rectifies current issues but also strengthens the organization's financial integrity and trust among stakeholders.

Addressing discrepancies found by external auditors requires a proactive and reflective approach. First, acknowledge the findings openly and communicate your commitment to resolving them. Assemble a dedicated team to investigate the root causes and develop corrective actions. Enhance internal controls and update financial procedures to prevent future issues. Maintain transparent communication with your auditors throughout the process. Use this opportunity to reflect on and learn from the oversights, revisiting risk assessments and improving internal audit functions. By doing so, you not only address the current issues but also strengthen your financial reporting and overall accountability.

Being Proactive and transparent taking action by addressing the discrepancies findings not only helps in resolving the current issues but also you build trust on your information you shared and strengthens your organization process for the future internal or external audits.

Taking proactive and transparent action to address discrepancies identified in audits is essential not only for resolving current issues but also for enhancing the credibility of your financial reporting. This approach fosters trust among stakeholders and strengthens your organization's processes, leading to more efficient and cost-effective outcomes in future audits.