The Purpose and Importance of Audit Trails
It is a general principle that well-managed audit trails are key indicators of good internal business controls. Over the last few decades, audit trails have transitioned from manual to automated electronic logs that make this historical information more accurate, readily accessible, and usable. This article will define an audit trail, what should be included, the importance of tracking this information, and how to best manage audit trail data.
What Is an Audit Trail?
An audit trail is a record of an event or procedure that provides evidence for authentication and verification of operational actions. Many industries use different kinds of versions of an auditing trail to document progressions based on a series of events. These records show that you’re following the rules and regulations.
Audit trails can also help identify areas of non-compliance by providing information for audits. Whether it is tracking the design changes of a new product, recording financial transactions, or communicating with customers, an audit trail records actions and outcomes. These records almost always include details such as date, time, and information related to the transaction.
There Are Different Types of Audit Trail Activities
A record of an audit trail provides basic information for tracking down the origin of an event. This may include user activity, access to data, logins, administrator activities, or automatic system activities. An audit record contains elements defined by the company, including:
- What the event was.
- What user, system, or application launched the event (this information may include IP address and device type).
- The date and time the event occurred.
A clear and well-defined audit log provides the evidence required to find answers and resolve issues.
The Importance of an Audit Trail
An audit trail provides a baseline for trend analysis or an audit if you initiate an investigation. Depending on the organization, the purpose or importance of an audit trail can take many forms. For example, a company may use the audit trails to generate historical reports, plan future budgets, or manage risks.
Benefits of an Audit Trail
The ability to trace records back to their origin allows various benefits, including transparency and record integrity. Some great examples are:
- User Accountability: A user is anyone who has access to the system. In addition, the user knows that their actions are automatically recorded and tied to their unique identity.
- Reconstruction of Events: When an investigation is warranted, the first step to remediate a problem is knowing the “when,” the “how,” and the “what” of the event.
- Other Problem Identification: Through real-time monitoring, you can use automated audit logs to identify problems that indicate system implementation issues, operational issues, or system and operator errors.
The Importance of Audit Trails for Compliance
Most industries today fall under several different regulatory statutes. Those entities, especially those that store electronic records, should maintain an accurate and complete audit trail and logging system. The right tools like a QHSE management platform can play a good role in the maintenance, security, availability, and integrity of the records to provide auditable information for the industry compliance.
Automation in Audit Trails
Audit trails are most effective if they are automated. Knowing what information to include in the logs is another key issue. It is recommended that the logs include basic information, at a minimum, such as who was involved, date and time, and what happened, but there may be other specific information to add which is dependent on industry expectations, and reporting requirements.