New IAIA Clinic

March 30, 2013

Definition of Internal AuditingDefinition of Internal Auditing

Internal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization's operations . It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes

Accounting and external auditing were major mechanism

Internal auditing was developed as a separate specialism task of accountant

Focus on financial transactions (Tick and Mark)

Thousands of transactionsReport to finance director/ manager

Early stage...Early stage...

The Institute of Internal Auditors was founded in 1941in New York

Created the systematic body of knowledge (framework)

Expanded to system- based auditReview of Input, Process and OutputStill financially focus

Recent historyRecent history

Risk -based auditFocus on what really mattersControl assurance frameworkRisk ManagementCorporate GovernanceConsultancy

At presentAt present

International Professional Practices Framework (IPPF)

•Attribute Standards•Performance Standards• Implementation Standards

Code of Ethics• Integrity•Objectivity•Confidentiality•Competency

International StandardsInternational Standards

Certified Internal Auditor (CIA)Certified Fraud Examiner (CFE)Certification in Control Self-assessment (CCSA)

Certified Financial Services Auditor (CFSA)

…..and more

CertificatesCertificates

Various types of Internal Audit Various types of Internal Audit

In house teamsOutsourcePartnership of both

Types of AuditingTypes of Auditing

Financial AuditingOperational or Performance AuditingCompliance AuditingManagement AuditingInformation Technology AuditingSpecial Auditing

Integrated audit

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Internal Audit Process

Internal Audit Process

Preliminary Survey

Formal Process of workFormal Process of workPlanPrepareDocumentEvaluate ControlsTest ControlsField work – substantive testReportFollow up

Scope of audit workScope of audit work

Reliable and Completeness of Financial Information

Working systems which have impacts on performance, policy, strategy and legal issues

Asset ManagementEffectiveness, Efficiency and EconomyCompliance with laws and regulations

Benefits of being IABenefits of being IAChallengingExcitingMeet lots of peopleImprove your communication and

personal skillsBest training ground for being top

manager

Because…Because…

It’s not just about finance!!!All aspects of the organizationEveryday is differentMeet people well above your own

statusThey respect your opinionKnow more about your organization

But it’s also…But it’s also…

Need professional skillsConfidentialHard workThought provokingStressfulRe-activeTime consuming

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Competencies needed for Competencies needed for internal auditorsinternal auditorsInherent Personal QualitiesIntegrityPassionWork ethicCuriosityCreativityInitiativeFlexibility

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Knowledge and SkillsKnowledge and Skills

Expertise in more than one area Technology Communication Analytical Thinking

Thank youThank you