Final answer:
The 3 fundamental phases in the internal auditing engagement process are planning, fieldwork, and reporting.
Step-by-step explanation:
The 3 fundamental phases in the internal auditing engagement process are planning, fieldwork, and reporting.
- Planning: In this phase, auditors gather information about the company's operations, identify risks, and develop an audit plan. They establish objectives, scope, and resources required for the audit.
- Fieldwork: This phase involves the actual testing and examination of internal controls and financial records. Auditors perform procedures such as sample testing, document review, and interviews to assess the effectiveness of controls and detect any irregularities.
- Reporting: After completing the fieldwork, auditors summarize their findings and communicate them in a formal audit report. The report includes the scope of the audit, identified issues, recommendations, and management responses.