What is the role of the internal audit function in the context of an AML audit?

The internal audit function plays a critical role in the context of an AML (Anti-Money Laundering) audit primarily by conducting the audit and reporting findings directly to the audit committee and the board. This reporting structure ensures that key stakeholders are informed about the effectiveness of the AML program, including any deficiencies or areas for improvement.

By having a direct line of communication with the audit committee and the board, the internal audit function can provide independent assessments and insights on risks related to money laundering and compliance with relevant regulations. This autonomy enhances the credibility and accountability of the audit findings, making it possible for the organization to take informed actions to strengthen its AML controls.

In contrast, merely overseeing operations, managing compliance training, or establishing external partnerships do not encompass the comprehensive responsibility of conducting audits and ensuring that the organization’s policies and practices are aligned with AML regulations. These functions can support the overall compliance environment but do not capture the core purpose and authority of the internal audit in relation to AML audits.