Operational Auditing--Fall Audit Finding Components n Condition n Criteria/Standard n Effect: Relate to 5 Control Objs. n Cause n Recommendation n Note: Exh is a variation of this model

Operational Auditing--Fall Recommendation Considerations n Does it solve the problem? n Is it feasible for the BPO? n Is it compatible with the BPOs ops.? n Is it cost effective? n Is it a long or short-term solution?

Operational Auditing--Fall Assessing BPOs Comments n Financial statement assertions n Internal control assertions n See Exhibit 11-3

Operational Auditing--Fall Other Issues-COSO Model n Audit Findings Summary (pps to 11-9) n S-C-O-R-E classification n Impact and likelihood n Flows into Risk Matrix n Supports C 3 ER model n Note alternative approach in Exhibit 11-10

Operational Auditing--Fall Reporting Standards n Signed written report n Pre-issuance discussion n Clear, objective reporting n Purpose, scope & results required n Recommendations optional n Auditee response optional n Review of report & distribution

Operational Auditing--Fall Report Use n Audit Staff n Work summary n Action catalyst n Training n Evaluation n Follow up

Operational Auditing--Fall Report Use n Operating Management n Action catalyst n Support n Visibility n Evaluation n Top Management n Visibility n Audit scope n Objective insight

Operational Auditing--Fall Closing Conference n Audit review n Major findings n Other findings n Report review logistics n Audit conduct feedback n Thank you’s

Operational Auditing--Fall Report Model n Cover n Formalities n Executive Summary n Findings n Major n Other n See summary at to 11-17, to

Operational Auditing--Fall Effective Writing n Gather information n Conversational style n Keep it short & simple n Active voice n Familiar vocabulary n Use captions n Use italics and white space n Use graphics & footnotes

Operational Auditing--Fall Other Reporting Issues n Interim updates n Distribution n Audit Committee n Senior Management n Department Management n Internal Audit n External Audit