Peer Review Readiness

What State’s Can do to Prepare

Standard

Policies Audits Review Report

Standard

Policies Audits Review Report

Why have a Peer Review?• Who audits the

auditors?• Credibility• Standards

Yellow Book (GAGAS)

• 3.82 Each audit organization performing audits in accordance with GAGAS must:……b. have an external peer review performed by reviewers independent of the audit organization being reviewed at least once every 3 years.

Redbook (IPPF)

• 1300 – Quality Assurance and Improvement Program External assessments must be conducted at least once every five years by a qualified, independent assessor or assessment team from outside the organization..

STANDARDSKnow what standards you are following

Standard

Policies

Audits Review Report

Policy or Procedure Manual

Areas to address

• Independence/Objectivity– Highest level/Audit

Committee– NO Management role

Areas to address

• Professional Judgement• Competence• Continuing Professional

Education• Quality Control

Areas to address

• Planning – Annual Plan– Individual audit

planning– Risk Analysis

Areas to address

• Supervision• Evidence• Documentation• Reporting

POLICIESMake sure your manual covers everything that it should

Standard

Policies

Audits

Review Report

Audits

• List of all audits– Assignment Name/Title– Audit Group Control Number (if applicable)– Personnel Assigned– Staff days/hours to complete– Date report was issued– Who the report was submitted to– Type of Assignment

Type of Assignment

Which Bucket?• Financial• Performance• Attestation• Non-Audit Service

– Assurance Activities– Inquiry activities– Consulting Activities

Audit Documentation

• Qualifications• Independence• Due Professional Care• Quality Control

• Fraud, Illegal Acts, Non-compliance

• Evidence/Work papers• Internal Controls• Reporting

AUDITS

Make sure every audit, review, and service you provide is accounted for, classified and documented.

Standard

Policies Audits

Review

Report

Request a Peer Review

• Form to complete – AASHTO• Submitted before /at the Annual Meeting• Chair of the Peer Review Committee– Find team leads– Find team members– Late forms not guaranteed

Peer Review Please!

Schedule Review

• Available dates from team assigned• Lead will contact the State• Week of Review established– Provide a list of possible hotels…..– Directions– Other important travel info

Engagement Letter

• Head of Audit Questionnaire• Copies of Relevant Policies, Rules, and

Manuals• Copy of recent Peer Review• List of Audits• Audit Staff Questionnaires• Department Head, Audit Committee, and

Auditee Questionnaire

On-Site Visit

• Entrance Meeting• Fieldwork– Review Policies– Review Workpapers– Review CPE– Compile Questionnaires – Follow up as needed

• Questions• Daily Update meetings• Exit Meeting• Draft Report, if possible

REVIEW

This should be a COOPERATIVE process where everyone learns from each other.

Standard

Policies Audits Review

Report

Report Process

Report Process

• Finalize Workpapers• Draft Report to State• State’s Response included• Quality Control Review– Questions addressed to lead/team– Additional Information gathered, if necessary– Adjustments are made

• Peer Review Chair Issues Report

REPORTThe report says it all……...

After the Review

• Action plan• Implement changes• Document, document, document

STANDARD

Questions?

Vickie Murphy, Montana Department of TransportationChief Auditor, Audit Servicesvmurphy@mt.govWork: 406-444-6104Cell: 406-431-3818

Beartooth Highway/ May 2005