I am on an internal IT audit project. The manager in charge and the director have no IT OR Audit experience. I’ve done both internal and external audits. They both said not to rely on audit standards when discussing gaps with the client. How do you do this? Serious question

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You base it off best practice and a framework. Your clients should have one. The standard one is NIST and it's really the bare minimum standards. You can also check HIPAA regs and things like ISACA and AICPA for bets practice and guidelines.

Your post is also pretty concerning. I've been hearing more and more about situations like this and from interviewing with firms.

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