Enhancing Governance through internal audit

Internal Audit Overview

Conference on Public Internal Control in the EU
May 15, 2014
Thijs Smit
President
Enhancing Governance through internal audit
Introduction
Thijs Smit
ECIIA
Internal Audit
Definition
3 lines of defence
2020
Quality Assurance
Audit Committee
Agenda
Enhancing Governance through internal audit
Thijs Smit
PTT KPN 1978 1997
Corus 1997 2000
Ahold 2000 2005
SNS REAAL 2006 2010
SHV 2011
Enhancing Governance through internal audit
European Confederation of Institutes of
Internal Auditing
The ECIIA represents the beacon of the Internal Audit
profession in the wider geographic area of Europe and the
Mediterranean basin
37 countries
40.000 members
Primary objective of furthering the development of
corporate governance and internal audit through
knowledge sharing, key relationships and the
regulatory environment oversight
Enhancing Governance through internal audit
Definition Internal Audit
Internal auditing is an objective assurance activity that
benefits an organization by providing independent evaluations,
advice,and insight on governance, risk management
and internal control.
Enhancing Governance through internal audit
1
st
line of defence 2
nd
line of defence 3
rd
line of defence
Internal
Audit
Actuarial Function
Risk Management
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Management
Controls
Internal
Control
Measures
Compliance
Governing Body / Audit Committee
Senior Management
The three lines of defence model
Enhancing Governance through internal audit
Less emphasis on controls and more on risk management
and governance
New risks to consider: reputational damage,
Audit plan reviewed more regularly
Technology: Mega Data and GRC
More focus on key risks, key recommendations
More operational skills and emphasis on soft skills
(communication, project management,)
*IA Magazine : interviews of thought leaders , 2013 Pulse Survey, New risks for internal audit
In the public sector
Internal audit in 2020*
Enhancing Governance through internal audit
Quality Assurance
Audit the Auditor
Crucial to bring profession to the next level
Mandatory in certain situations
Enhancing Governance through internal audit
Oversee Internal Audit
Ensure independence
Assess quality
Direct reporting line
Assess quality external Auditor
Review risks
Oversee financial reporting
Coordinate assurance functions
Review internal control framework
Audit Committee Roles
Enhancing Governance through internal audit
www.eciia.eu