A gap analysis is a method of assessing the differences in performance between a business’ internal controls to determine whether business requirements are being met and, if not, what steps should be taken to ensure they are met successfully. Moreover, it is a determination of the degree of conformance of your organization to the requirements of an internal controls standard. A gap analysis is mainly a document review or a “show me the evidence” type activity, evidence which usually will come in the form of a record or document. During a gap analysis, there is some auditing accomplished, through key stakeholders providing the evidence they may have – or not – for each of the requirements set forth in the relevant internal controls standard. In this episode, I am joined by AMI’s Eric Feldman to explore this topic.
3 Key Takeaways
- Now is the time for a gap analysis.
- Add a Fraud Risk Assessment to your gap analysis.
- Culture is a foundational internal control.