Build a practical exception-rule library for recurring internal audit: duplicate payments, leaver access, stale BRS items, aged reconciliations, GST/TDS delays, covenant watchlists and other monitoring tests.
| Cycle | Rule | Data source | Exception logic | Cadence | Owner |
|---|---|---|---|---|---|
| Procure to Pay | Duplicate vendor bank accounts | Vendor master | Same bank account used by more than one active vendor, excluding approved group/vendor relationships. | Weekly | Procurement finance |
| Procure to Pay | Duplicate invoice risk | Purchase invoice register | Same vendor plus invoice number, invoice date and amount repeated, or same amount/date with similar invoice reference. | Weekly | Accounts payable |
| Procure to Pay | MSME ageing breach | Vendor master and open payable ageing | MSME vendors unpaid beyond agreed 15/45-day terms or missing MSME classification evidence. | Weekly | Accounts payable |
| Order to Cash | Credit-limit override | Customer master, sales orders and override log | Invoices or dispatches released where exposure exceeded approved limit without documented approval. | Weekly | Sales finance |
| Order to Cash | Long-outstanding receivables | Debtors ageing and collection tracker | Balances beyond threshold ageing with no recent collection note, dispute tag or approved legal escalation. | Weekly | Receivables |
| Record to Report | Late manual journals | GL journal dump | Manual journals posted after close deadline, on weekends, by senior users, or without attachment/reference. | Monthly close | Controllership |
| Record to Report | Aged reconciling items | Balance-sheet reconciliation tracker | Reconciling items older than policy threshold or repeated for more than two closes. | Monthly close | Controllership |
| Cash and Bank | Stale BRS items | Bank reconciliation | Open bank or book reconciling items older than policy threshold, split by receipts/payments/bank charges. | Monthly | Treasury operations |
| H2R and Payroll | Payroll to leaver match | Payroll register and exit list | Salary, reimbursement or statutory contribution processed after last working day without FNF approval. | Monthly | Payroll |
| H2R and Payroll | Bank account reuse | Employee master | Same salary bank account mapped to more than one active employee without approved family/exception note. | Monthly | Payroll |
| Statutory Compliance | GST/TDS filing delay | Compliance calendar, returns and challans | Return or payment completed after statutory due date, or reconciliation not reviewed before filing. | Monthly | Tax |
| Treasury | Covenant watchlist | Loan agreements, covenant tracker and MIS | Covenant ratio approaching breach threshold, actual breach or missing lender reporting evidence. | Monthly | Treasury |
| Treasury | Unauthorised bank guarantee/LC | BG/LC register and bank statements | Guarantee, LC or charge created without approval, limit availability check or register update. | Monthly | Treasury |
| ITGC and Access | Leaver access active | HR exit list and user access extract | Separated employee retains ERP, bank portal, email, VPN or privileged application access after exit date. | Weekly | IT |
| ITGC and Access | Privileged user activity | Admin user list and activity logs | Privileged user changes master data, approvals or configuration without ticket and independent review. | Weekly | IT |
Build the underlying RCM or open the monitoring rules guide.
Continuous monitoring converts repeatable audit procedures into periodic exception rules. It is strongest for complete-population checks such as duplicates, ageing, overdue reconciliations, access conflicts and filing delays.
The output should not be treated as automatic audit evidence. Exceptions need threshold tuning, false-positive review, evidence retention, owner assignment and follow-up before they become internal audit observations.
A finance team wants monthly internal audit monitoring for P2P, statutory compliance, treasury and ITGC.
