In recent years, there has been significant emphasis on the role that internal audit plays in ensuring that firms have robust AFC controls. Financial institutions (FIs) have encountered many challenges on establishing an effective governance model with proper controls in place. Discover what these are and the potential of internal audit in ensuring that AFC controls remain effective.
- Skills and expertise of the audit function can be mixed based on the maturity of the organization. Ensuring auditors receive technical training, at least to the level of the second line, is paramount for successful and meaningful audits.
- Organizations may inadvertently fall into several traps when it comes to financial crime audits including lack of planning, quantity of audits performed, and the timing of audits.
- Auditors need to remain independent so they can review business processes and controls without prejudice. Often, this independence translates to an arm’s length approach.
Underpinning these challenges is organizational culture. The tone from the top, incentivization, accountability play an important part in ensuring AFC audits act as effective controls.