Audit Policy Writers

What are the Audit Policies?

Audit policies outline how organisations plan, conduct and report on audits to ensure compliance, accountability and continuous improvement.

Audits provide independent assurance that processes, systems and controls are working effectively. A clear policy helps ensure audits are carried out consistently, risks are identified early, and corrective actions are implemented to strengthen governance.

What Do Audit Policies Cover?

An audit policy typically includes:

The scope and purpose of internal and external audits
Responsibilities of managers, staff, auditors and audit committees
Procedures for planning, scheduling and conducting audits
Risk-based approaches to selecting audit priorities
Requirements for evidence gathering, record-keeping and reporting
Processes for identifying non-conformities and improvement actions
Follow-up and monitoring of corrective actions
Independence and objectivity standards for auditors
Links to risk management, compliance, finance and quality assurance policies

A clear policy ensures that staff understand the role of audits, their responsibilities during an audit, and how findings will be addressed.

It also supports compliance with regulatory requirements, accounting standards and industry frameworks such as ISO 9001 and ISO/IEC 27001.

By embedding audit processes into governance structures, organisations can improve accountability, reduce risks and strengthen operational performance.

Audits also provide assurance to regulators, customers and stakeholders that the organisation is operating responsibly and transparently.

Legal Basis and Standards

Audit policy in UK organisations is shaped by the Companies Act 2006 (statutory audit thresholds and duties), the FRC's Audit Standards (ISAs UK), the FRC's Guidance on Audit Committees, and a network of internal audit standards: ISO 19011 (auditing management systems), the IIA's International Professional Practices Framework (IPPF), and ISO 27001:2022 clause 9.2 (internal audit) for information security.

Sector-specific audit duties apply: the Local Government Act 1972 and Public Audit (Wales) Act 2013 for local authorities; the National Health Service Act 2006 and NHS Internal Audit Standards for healthcare; FCA SYSC for regulated financial services; and the draft Audit Reform and Corporate Governance Bill (consulted on 2024-2025) which is set to bring the largest private companies within audit-committee reporting expectations.

Common Compliance Pitfalls

Internal audit independence compromised. Where internal audit reports to the function it audits, the IPPF independence requirement is breached.
External audit firm rotation rules misapplied. Mandatory firm rotation rules apply to PIEs (banks, insurers, listed companies), 10 years standard, extendable in defined circumstances.
Audit findings closed without evidence. Closing a finding requires evidence the corrective action was effective, not only implemented.
No three lines model. ISO 27001 and FRC guidance both expect a clear separation between operational management, oversight functions and independent audit.
Audit plan not risk-based. Annual audit plans driven by tradition rather than current risk assessment.

Sector-Specific Considerations

Listed companies and PIEs: Audit Committee reporting under the FRC Code 2024 and the FRC Minimum Standards for Audit Committees.

Public sector: Public Sector Internal Audit Standards (PSIAS) and the Local Government Application Note apply.

Healthcare: NHS Internal Audit Standards and the Healthcare Internal Audit Common Assurance Framework set the expected scope.

ISO management systems: ISO 9001, 14001, 27001, 45001 each require a documented internal audit programme reviewed at management review.

What Policy Pros Delivers

Our Audit Policy package includes the main policy, an internal audit charter, a risk-based annual audit plan template, an audit working-paper template, a finding and corrective-action register, an audit-committee reporting template, and integration points with the risk management and management-review procedures.

Sector-specific add-ons cover ISO management systems, PSIAS, NHS audit standards, and FRC audit-committee reporting.