Which of the following is the best approach for the internal audit function to communicate moderate and high risk observations to management?
A.
Prepare a formal observation worksheet for all observations identified and send to management to review and provide feedback at the end of fieldwork.
B.
Verbally communicate the high risk observations to management when identified and prepare a documented worksheet that includes the root cause, effect, and recommendations.
C.
Prepare a formal observation worksheet for the high risk observations and a separate worksheet for the medium risk observations in an email to management.
D.
Verbally communicate all observations to management at the end of fieldwork and provide a formal worksheet for review and feedback.
According to Standard 2440 – Disseminating Results, internal auditors should communicate significant observations timely, especially high-risk issues that require immediate attention. Verbal communication upon identification allows management to act quickly, while formal documentation ensures proper recording and follow-up. Option B reflects this balance by providing both verbal escalation for high risk and documented evidence of findings with root cause, effect, and recommendation.
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