In a dynamic risk and regulatory landscape, internal audit is more critical—and more complex—than ever. Financial institutions must rely on both audits and compliance reviews to identify risk, reveal process gaps, and ensure adherence to compliance standards . While these two functions share common goals, there are key differences in their approach, scope, and purpose.
An audit is a formal, independent examination of a process, report, or system's effectiveness and accuracy. A compliance review is a check performed by a financial institution's own compliance department to confirm that staff are following internal policies and regulatory requirements.