What Is a Compliance & Procedures Audit?

A Compliance and Procedures Audit reviews how your company actually operates against how it should — finding gaps in internal controls, policy adherence, and procedural consistency before they become costly problems.

Definition

A Compliance and Procedures Audit is an independent, structured review of whether your company is operating in accordance with its own stated policies and procedures, applicable laws and regulations, and management's intentions. Unlike a financial audit (which focuses on the accuracy of financial statements), a Compliance and Procedures Audit focuses on the operating system: how decisions are made, how controls are applied, and whether the organisation is exposed to risk.

What It Covers

Financial Controls

Approval authorities: are purchases, contracts, and payments being approved by the right level of authority?
Segregation of duties: is the same person who orders also the one who receives and pays? (A classic fraud risk.)
Bank reconciliation: is it done independently, completely, and on time?
Petty cash: is the float controlled, reconciled, and not used as a personal fund?

Procurement and Vendor Management

Are vendors selected through a documented competitive process, or from the same list of "preferred" vendors with no review?
Are contracts in place for all significant vendor relationships?
Is there a related-party risk in vendor selection?

Revenue and Collection

Is every shipment matched to a signed delivery note and a valid invoice?
Is the collections process managed systematically against an aged receivables report?
Are credit limits set, documented, and enforced?

Inventory and Assets

Are stock counts conducted regularly and reconciled to the system?
Are physical assets tagged, registered, and periodically verified?

Who Needs This?

Any growing company that has not had an internal control review in the past 2–3 years. The risk is that the controls that worked when the company had 20 people are now being applied inconsistently across 100 people — and nobody notices until there is a fraud, a regulatory finding, or an external audit exception.

Output

A written findings report with risk ratings (Critical / High / Medium / Low), root cause analysis, and a prioritised management action plan with owner names and deadlines. We do not just write the report — we facilitate the management response and track implementation.