What are the benefits of internal audit in the not for profit sector?

Strong governance, coupled with effective internal procedures and controls, is essential for any organisation, but is particularly important for those entrusted with public funds, including multi-academy trusts, charities, and parish and town councils. If your organisation operates in one of these sectors, Larking Gowen’s internal audit service can help you.

What is internal audit, and how does it differ from statutory external audit?

Internal audit is an independent, objective assurance and advisory function that evaluates how effectively an organisation manages risk, controls its operations, and governs itself.

Whereas Larking Gowen’s external audits are closely focused on the accuracy of the year-end financial statements, our internal audits examine and report on internal processes and controls during the financial year.

We see our role as internal auditors as twofold:

1. Assurance – providing confidence that processes, systems, and controls are functioning as intended.
2. Advisory – offering insights and recommendations to improve efficiency, reduce risk, and strengthen the overall design of your internal controls, as well as their operational effectiveness.

In essence, internal audit acts as a “critical friend” to the organisation: supportive, but independent enough to provide challenge and highlight areas that can be improved.

A tailored internal audit service drawing upon our knowledge of the not for profit sector

Larking Gowen’s internal auditors sit within our not for profit team and draw upon our firm’s in-depth sector knowledge to offer a flexible internal audit service tailored to the individual needs of our clients.

Multi-academy trusts and charities

• We carry out two or three ‘deep-dive’ internal audits in each financial year, each one closely focused on a particular ‘hot topic’ area, for example risk management, staff training, cyber security, the embeddedness of policies, or compliance with the sector’s regulatory requirements.
• We use our sector knowledge to ensure our work is tailored to each individual client, while recognising the need to meet the regulatory and advisory requirements of the Department for Education or the Charity Commission.
• Our work utilises a mix of testing, interviews, and questionnaires, alongside both onsite and remote work. This allows us to speak with a wide range of people while acknowledging the multi-site nature of multi-academy trusts and many charities, giving us a full picture across the organisation.

Parish and town councils

• We usually carry out two onsite visits to the council offices per year: one at mid-financial year and one just after financial year-end. However, we can tailor the timing of our visits to the size and nature of each client.
• Our internal audit reporting for councils is built closely around the requirements of the Annual Governance & Accountability Return’s Annual Internal Audit Report.
• Our programme of testing incorporates the latest best practice requirements set out in the Smaller Authorities Proper Practices Panel’s annual Practitioners’ Guide. This gives our clients assurance that our work covers the full range of the council’s operations.

The benefits we bring to all clients

While our approach differs between sectors, the core benefits of working with us remain consistent.

Independence and objectivity

As external professionals, we provide an unbiased, fresh perspective. This independence is critical in identifying issues that may otherwise go unnoticed.

Sector expertise

We specialise in the types of organisations we serve. This means we understand the regulatory frameworks, common challenges, and best practices specific to your sector.

Clarity and communication

We pride ourselves on clear, accessible reporting. Our findings are easy to understand and designed to support informed decision-making, not just satisfy compliance requirements.

Value beyond compliance

We don’t see internal audit as a “tick-box” exercise. Our aim is to add real value.

A partner in good governance

Ultimately, effective internal audit helps you demonstrate accountability, manage risk, and improve how your organisation operates. Whether you are a local council seeking reassurance over your controls, a multi-academy trust looking for meaningful insight into key risks, or a charity keen to ensure you are following sector best practice, our internal audit service can act as a trusted partner in your governance framework.

Need help?

If you would like to explore how our internal audit services could support your organisation, we would be delighted to speak with you.

Get in touch with your usual Larking Gowen contact or email enquiry@larking-gowen.co.uk

You can also contact:

• our Partner for internal audit, Giles Kerkham
• our internal audit managers, Yulia Varvel and myself, Marc Cawthorne.

Marc Cawthorne