Modern Risk-oriented Internal Auditing Research Of Commercial Banks

Nowadays, commercial banks play an important role in the financial system andmake big contributions to national economy development. As a kind of specialenterprise which lives on the trust, the risk management of commercial banks isparticularly important. Commercial banks’ internal and external risk is graduallyincreasing at the background of complex situation. Internal audit, as the third line ofdefense, must work out fine. However, the traditional audit model can’t conform tothe requirement of the new age; commercial banks need new audit methods to riskmanagement and then improve their values.Risk-oriented auditing, as a kind of new ideas, first used by CPA since1980s, inthe subsequent ten years, people think it is a good method, and then risk-orientedauditing had been spreading to various professions. In China, the study ofrisk-oriented auditing is just beginning but developing fast. Compared with thedeveloped countries, we have a lot of deficiencies both in theory and practice. In thispaper, from the view of commercial banks, we make a study on how to use themodern risk oriented audit in the internal audit. This paper firstly explains the relatedtheories of modern risk oriented internal audit, the basic procedure and methods. Andthen discusses necessity and feasibility of the modern risk oriented internal audit inbank. In the subsequent part, this paper takes X bank internal audit as example, makesfurther research on modern risk oriented internal audit in its specific application. Thecorresponding suggestions are also provided at last.In this paper, the research methods of normative analysis and case analysis areused, qualitative and quantitative analysis methods are also used to evaluate the riskof X bank in order to identify the risk and improve the efficiency of auditing. I hopethe research can provides beneficial reference for the banks’internal audit.