What is the main purpose of an internal audit function?

The main purpose of an internal audit function is to evaluate and improve governance and risk management processes. Internal audits are an essential aspect of an organization's overall governance structure, providing independent and objective evaluations of the efficiency and effectiveness of its operations.

By assessing the adequacy of internal controls, risk management practices, and compliance with policies and regulations, internal auditors help organizations identify potential issues and areas for improvement. Their work ultimately supports better decision-making and helps ensure that an organization can achieve its strategic objectives while managing risks appropriately.

In contrast, preparing financial statements is typically the responsibility of the finance or accounting department rather than the internal audit function. External financial audits are conducted by independent external auditors and are separate from the internal audit processes. Ensuring compliance with marketing regulations is a specific area that may fall under different compliance or regulatory functions within an organization, not the primary purpose of internal auditing. This distinction highlights the critical role of internal audits in organizational governance and risk management rather than specific compliance or financial reporting duties.