Aveneu Park, Starling, Australia

As and internal financial control system. Due to the

As I am sure you are aware, the
fundamental role of Internal audit is to provide an independent, unbiased and
objective assurance and consulting service to the board of directors, including
yourself, whereby effectiveness of Triangle Plc’s risk management, established control
processes, and governance are evaluated for improvement. Therefore, giving
advice that enables your strategic objectives to be attained.

The newly created audit function is increasingly important,
at a time when you are facing many risks within the organisation. The
significant risk to your reputation due to recent events including allegations
of label tampering and violation of minimum pay laws must be managed
effectively. Effective mitigation strategies can be recommended by the internal
audit function to minimise risks such as these, who also assess compliance with
health and safety legislations to ensure health and safety risks are minimal.

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An internal audit function is essential to the board of
directors as it is your responsibility to implement risk management, an
internal control and internal financial control system. Due to the nature of
Triangle Plc being a hierarchical organisation, the board is far removed from
operational activities that occur lower down, such as activities occurring
within the factory, including the mislabelling of free range chickens. Although
management aims to solve this issue by providing a connection, management
information alone is unlikely able to provide sufficient assurance that
strategic, operational, compliance and reporting control are sound to enable the
entity to participate within its chosen risk appetite. This is solved through
the internal audit function which has access to information at all levels of
management meaning that they have in depth knowledge about every aspect of the
company.

The internal audit function will not undermine the
responsibility of management as according to the UK governance code C.3.2., the
effectiveness of Triangle Plc internal audit function should be monitored and
reviewed by the audit committee. By providing criticisms and direction for the
newly created audit function, the company’s board can ensure the quality of
their consulting and assurance based on agreed on procedures. Therefore, the
audit function has a direct influence on the work of the audit committee,
supporting their ability to offer supervision and constructive challenge at
board level to executives such as yourself.

As the internal audit function reports to an independent
committee composed of independent non-executive directors, they are not
pressurised by executives of the company, even if challenged or criticised, to
produce reports that are more favourable to these directors. This means that
reports remain professional and independently minded, maintaining their
objectivity. Therefore, reports present an accurate representation of Triangle
Plc and highlights necessary strategies needed to be implemented.

It is evident that the internal audit function is essential
in adding value to the board of directors. An internal audit function within
Triangle Plc will play a fundamental role in corporate reporting as it is able
to provide a comprehensive view of the whole organisation, it’s resource
management and understanding of the risks and controls that need to be
implemented, to the board of directors. This essentially enhances the quality and
accuracy of corporate reports and ensures that Triangle Plc implements the most
effective strategies to succeed.

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