The article examines the problems of improving the methodological foundations for regulating the preparation and conduct of internal financial audits of Public Administration bodies. It was found out that the current system of internal financial control and internal financial audit of public authorities in Ukraine does not allow us to fully ensure confidence in the legality, effectiveness and efficiency of spending budget funds. The shortcomings of the functioning of the system for preparing and conducting internal financial audits of Public Administration bodies are identified. Measures that are based on mechanisms for improving the quality of internal financial audit are identified. The stages of the process of preparing and regulating the internal financial audit of Public Administration bodies are systematized, and it is concluded that strict adherence to these stages will increase the effectiveness of audit activities, reduce the time spent on conducting an audit, eliminate errors or errors in these activities, and increase the effectiveness of the results obtained. It is proved that the formation of methodological foundations for conducting a procedural internal financial audit of public authorities is influenced by its focus on the study of control systems and the ability of administrative bodies to manage business risks. An algorithm for conducting internal audits of public authorities of Ukraine has been developed. Methodological bases for optimal segmentation of the activity of the audit object for the purposes of a planned audit are formed. It is determined that the conducted empirical research, taking into account the specifics of the public sector, allows us to assert a greater efficiency of selecting elements for testing, based on the synergy of block and expert selection methods, which allows us to ensure high representativeness of the sample with minimal financial and labor costs for its formation. General rules for testing, analyzing, and summarizing results have been formed. Suggestions are provided for improving the documentation of test results and providing audit conclusions.