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Aspects
Definition
Internal
It
Amenable to
enforcement
Easy to
understand
Auditing
Standards
Flexibility for
application
Universal
acceptance
While AUDIT is an
independent examination
of financial statements for
expressing an opinion
thereon, whereas
assurance is provided by
such an examination and
report.
Assist
external
inspection
Record
matters of
continuing
significance
Create
accountability
Objective
Prepare documentation
that provides
Requirements
Assembly
of
Final Audit File
Documentation of
Audit Procedures
and Audit Evidence obtained
Identify Risks
Find Better Ways and Best Practices
Partner With You to Find Solutions
Prevent Problems
We have a plan!
Audit plan developed with input from across
the organization
Risk factors:
Impact
Probability
Controls
IA Code of Ethics
Principles
Internal auditors are expected to apply & uphold the following principles:
Integrity
Objectivity
Confidentiality
Competency
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Budgetary Control
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Internal control makes the right things happen the first time
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Purchasing limits
Approvals/ segregations
Security
Reconciliations
Proper operating &
accounting procedures
MONITORING
INFORMATION AND
INFORMATION
&
COMMUNICATION
COMMUNICATION
CONTROL ACTIVITIES
CONTROL
ACTIVITIES
RISK ASSESSMENT
CONTROL ENVIRONMENT
Corporate
communications
(e-mail, meetings)
Based on
identification &
analysis of risks to
achievement of
objectives
Corporate Policies
Tone at the top, ethics
Organisational
authority
Skilled personnel
use
of
Focus on areas with high risk & high probability that controls are not in
place or are weak
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Develop & execute risk based sampling & testing approach to determine
whether most important controls are operating as intended (NB: input from
Management required e.g. 100% sampling of WA review)
Describe key risks facing the business activities within scope of audit
Identify control procedures used to ensure each key risk is properly controlled &
monitored
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Updated annually
staff
including Management
Summary of key goals, risks & corresponding major audits, to illustrate alignment
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Prevent Problems
Provide training
Respond to policy & technical accounting questions
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Preventive Measures
RISK
MANAGEMENT
Section 138(1)
Prescribed class of companies shall conduct the internal
audit of the functions and activities of the company.
As per Draft Rules: Every listed company, every public
company with paid up share capital > Rs 50 cr, or turnover of
200cr or any outstanding loans or borrowings from banks or
public financial institutions > Rs. 100 cr or which has
accepted deposits of > Rs. 25 cr at any point of time during
the last financial year)
12/21/2014
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RISK
MANAGEMENT
12/21/2014
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