Analysis Of Internal Audit Of Commercial Banks Based On Risk-oriented Auditing

With the gradual deepening and improvement of China's market-oriented reforms,commercial banks are facing increasingly fierce competition.In the process of seeking business transformation,some banks prefer high-risk,high-yield businesses.They place too much emphasis on economic interests in their operations but neglect internal audit and risk prevention and control,thus taking risks beyond their own management capabilities.This situation puts forward higher requirements for banks' credit risk,market risk and liquidity risk management capabilities.With the implementation of a series of regulatory measures,the over-expansion of bank credit scale has been suppressed,and banks are also encouraged to increase their awareness of capital constraints,actively adjust their business structure,actively optimize their asset structure,increase capital utilization efficiency,and enhance risk management capabilities.Therefore,commercial banks have to pay great attention to the professionalism and standardization of internal auditing,and help to realize the value-added objectives of commercial banks from a professional and systematic perspective.As a modern audit method,risk-oriented internal audit is increasingly recognized and respected by domestic commercial banks.However,due to the risk-oriented internal audit of commercial banks in China is still at an exploratory stage,many obstacles are encountered in practical operations.Therefore,this paper attempts to start from the perspective of MS Bank and follow the basic research ideas of “proposed problem-analysis problem-empirical experience-solving the problem”,using a combination of theoretical analysis and case analysis methods to modern risk-based auditing theory and its The application of commercial banks' internal auditing is studied and it is hoped that based on this research result,meaningful conclusions can be drawn on the application of risk-oriented auditing in commercial banks in China.This article uses strategic management theory,comprehensive risk management theory and system theory,adopts literature research method,case study method and comparative research method.Based on the review of domestic and foreign research literature system,MS Bank is selected as a case,and risk-based business The bank's internal audit problems and methods for improvement were analyzed.The research results show that the main problems in China's MS bank risk-oriented internal audit application are:(1)the risk-based audit cannot be fully implemented,(2)the electronic business lacks the ability to solve new problems,and(3)the lack of financial innovationCognitive judgments of risk points,(4)pressures on assessment indicators encourage internal default violations,and(5)the quality of auditors needs to be improved.From the analysis of the reasons for the problems,the internal auditing mechanism is not perfect,there is a deviation in the bank's internal understanding of internal auditing,the risk-oriented internal auditing method is not perfect,and the performance appraisal system does not attach importance to risk management in design,and the qualification of internal auditors.Inadequate entry criteria and assessment mechanisms have all created obstacles to the actual operation of commercial banks' internal auditing.Through the experience of risk-oriented internal audit of foreign commercial banks represented by Citibank and British Bank HSBC,this paper gets the internal audit of foreign commercial banks more mature than domestic:(1)The independence of internal audit is relatively high,(2)Take risk prevention and monitoring as the audit focus,(3)strictly require the quality of internal auditors,and(4)internal audit focus on the use of audit results.The history of foreign commercial banks is even longer,and the exploration of internal control and internal auditing takes longer than domestic ones.This has implications for strengthening the internal auditing of commercial banks under risk-oriented China.After learning from the successful experiences of commercial banks in developed countries and combining with the actual situation in China,this paper proposes four countermeasures for improving the risk-oriented internal audit of MS banks.The first point is to improve the internal audit mechanism,including the further implementation of the risk early warning and assessment mechanism,the establishment of an effective audit quality monitoring system,and the improvement of the auditing system.The second point is to further change the working philosophy,shift from the "supervisory type" to the "service type,value-added type" audit model,and turn it into a risk-oriented audit-based audit model while expanding the scope and content of internal audit.The third point is to make full use of off-site audit techniques,strengthen the construction of off-site auditing systems and audit management systems,increase auditing innovations,and promote the use of information systems.At the same time,audit collaboration and effective use of external forces are carried out.The fourth point is to strengthen the construction of the audit team,including strict access thresholds for internal auditors,intensified professional technical training and professional quality education,and increased two-way flow between auditors and business managers.For China's risk-oriented commercial banks,it is very important to improve internal auditingaccording to their own conditions.