Internal Audit

C. P. Mansoor S. AhmedM. Com, PGDBA

Internal Audit

Not confined to Independent Audit Systematic Examination of

Records Procedures Systems Operations

Definition

“Internal Auditing is an independent and an objective assurance and consulting activity designed to add value and improve an organization’s operation. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control & governance process.” IIA USA

Scope of Internal Audit

Risk Management & Control Reliability & Integrity of Financial & Operational Information Compliance with Laws, Regulations & Contracts Safeguarding the Assets Effectiveness & Efficiency of Operations Accomplishments of Objectives & Goals for operation

Governance Promoting Values & Ethics Effective Organizational Performance Management &

Accountability Effectively Communicating Risk & Control Information to

appropriate areas of organization Effectively co-ordinating the activities of and communicating

information among the board, external & internal auditor and management.

Need for Internal Auditing

Growth Size Operation Location

Specialists Records Procedures Systems Operations

Operation of INTERNAL AUDIT

Purpose, Authority and Responsibility Planning Policies and Procedures Personal Management and

Development External Auditors Quality Assurance

Professional Proficiency of Internal Audit Department

Staffing Knowledge, Skills and Disciplines Supervision

Performing Audit Work

Planning the Audit Examining & Evaluating Information Communication Results Appropriate Follow-up Preparation of Audit Reports Discussion and Follow-up of Reports Reporting to Top Management

Code of Ethics for Internal Auditors

•Honest, Diligent, ResponsibleIntegrity•Nothing that conflicts with the interest of the organizationObjectivity

•Mis-use of informationConfidentiality

•Subjected to professional expectancyCompetency