Internal Audit Awareness

Internal Audit Awareness

Note to presenters: Different slides in this presentation may appeal to different audiences including board members, senior leadership, faculty and staff, and students. Please feel free to utilize the slides that best meet the needs of your audience. It is not anticipated that all slides will be needed for all audiences. In addition to the information on the slides, detailed information has been provided in the Notes section of many slides to assist in

Presentation Areas Internal Audit Background How Internal Auditors Work Audit Process

Internal Audit Background

Why is there Internal Audit? Regulations Federal (reference any applicable Federal requirements such as Federal Sentencing Guidelines) State (reference any applicable general statutes or other state requirements) Other guidance (system policies, etc.) To protect the organization

Accounting vs. Internal Auditing Accounting Internal Auditing Area of Focus Financial analysis Transaction processing Budgeting Record keeping Determining accuracy of financial reporting Internal Controls Compliance Effectiveness and efficiency of operations Governance structure Risk management Method of Working Transaction processing Cyclical financial reporting and budgeting Project based May include committee work and ongoing risk assessments Certifications CPA, CMA, etc. CPA, CIA, CISA, CFE, etc.

Types of Auditors External Auditors Hired by an organization Often financial statement or IT focus 25,000’ view Produce a report with an opinion Regulatory Auditors From a government agency or grantor May be called auditors, inspectors, compliance officers Ensure compliance with regulations Report, score Internal Auditors Work for the organization Risk-based audit plan Variety of audits based on industry Report or memo with recommendati ons

What is Internal Auditing? Independent and objective Value-added Improves operations Accomplishes objectives Improves effectiveness and efficiencies

The IIA Standards Independence Professional Proficiency Scope Performance of Audit Management Code of Ethics

Internal Audit at Institution Mission Include Mission Charter Background information such as approved (annually) by the board, aligns with the Standards, part of the Quality Assurance Review

Internal Audit Structure at Institution President/ Chancellor or Other Administrator Auditor (Name, certifications) Board of Trustees Audit Committee Chief Audit Executive/IA Director (Name, certifications) Auditor (Name, certifications) Auditor (Name, certifications)

How Internal Auditors Work

Working with Internal Audit Traditional vs. "Modern” Internal Auditors Evolution of Internal Audit Audit Engagements Different Types of Engagements Compliance Audits Operational Audits Consultations Investigations

Risk-based Auditing Goal: To identify areas in the university that have significant risks and to evaluate those areas to determine if those risks are being adequately managed. Risk Assessments What is risk? Factors affecting risk

Examples of Controls Preventive Controls Detective Controls Segregation of duties Exception reports Supervision Reconciliations Security of assets Performance reviews Reading and understanding current policies and procedures. Annual physical inventory counts

Audit Process

Audit Process (Update as needed) Planning Fieldwork Reporting Preliminar Interviews Develop y research Process draft audit Entrance report reviews Exit Meeting Document meeting Process reviews Manageme discussion Testing s nt and Informatio responses verificatio Final n n gathering Discussion report distributio Identificati of audit n on of issues/find scope ings items CONTINUOUS COMMUNICATION

Common Audit Findings Not Understandin g Requirement s Lack of Segregatio n of Duties Lack of Training Lack of Awareness Lack of Communicati on Lack of Compliance

Positive Impacts of Audits Institutio n-Wide Priority management Practical advice Comprehensiv e view of risk Departmen t-Wide Fraud prevention Improve efficiency and compliance Strong support

Hotline Information Insert your university’s hotline information here.

Contacting Internal Audit If you want to contact us, we are available via Phone (xxx – xxx – xxx) Fax (xxx – xxx – xxx) Email ([email protected]) Website (internalaudit.yourschool.edu) Or if you would like to visit us, we are located at

Thank You!