How would you convince a small/medium sized entity owners for having an Internal Audit department where the focus of entity is cost control ?

Internal Audit function will help a cost control focused small/medium organisation in the following ways:

1. Ensure that a pre-audit review is conducted on transactions and that policies and procedures instituted by management are strictly adhered to.

2. Evaluate risk areas within the organisation to avoid waste and losses.

3. conduct analytical procedure of management decisions and outcome and recommendations.

4. Periodically conduct performance management reviews. 

I will convince him that the main role of internal audit is to add value for the company, I will add value by check risks in each function with their managers and the required controls to accept, share or even avoid the risk.Also, we will try to save cost by assessing each process for purpose of any unneeded cost and recommend for the best efficient of quality  and required control for achieving company profitability.

SMEs in their nature have less formal and structured system of internal control which make them more vulnerable to operational risks and losses than larger structured entities.

Which increase the value added provided by internal auditors to SMEs. and help them to improve their internal control system.