This study develops a generalized procedure for the internal financial auditing of university libraries. It identifies critical internal control points in library operations, and develops questions to measure and evaluate fiscal operations effectiveness. Auditing data and advice were gathered from a survey of 87 members of the Association of Research Libraries (ARL), consultation with auditing organizations, visits to university libraries and the ARL, and review of auditing criteria by an advisory group of auditors, library business managers, and librarians. The study describes the standard auditing cycle to be followed in all university library audits: (1) understanding the accounting and internal control systems; (2) recording this; (3) preliminary evaluation of internal control; (4) confirming the operation of controls; (5) definitive evaluation of internal control; (6) completing the audit; (7) reviewing the internal library financial statements; and (8) issuing the report. Auditing programs for original record examination and testing would be developed after the system of internal control is evaluated, and a questionnaire for evaluation of internal accounting control of the library completed. Special considerations in auditing computerized systems, the questionnaire, and a glossary are included. (KP)