Document background
The Internal Audit Engagement Letter is a crucial document used in Indonesian business practice to formally initiate and define the parameters of an internal audit engagement. It serves as the primary reference document that outlines the scope, objectives, methodology, and expectations of the internal audit process. This document is essential when commencing any internal audit activity and must comply with Indonesian regulations, particularly OJK Regulation No. 56/POJK.04/2015 and relevant Bank Indonesia regulations for financial institutions. The letter typically includes details about the audit timeline, resource requirements, reporting protocols, and specific areas under review. It's designed to ensure clear communication between the internal audit function and the audited department while maintaining alignment with both local regulatory requirements and international internal audit standards. The document becomes particularly important in regulated industries and public companies where formal documentation of audit processes is mandatory.
