Annual Conference The Internal Auditor – value added to both the Audit Committee and Management 7 November 2012

Role of Internal Auditor INTERNAL AUDITOR..... different reactions, misconceptions, and connotations  corporate policeman  financial watchdog – part of the Finance Department  monitors the financial statements ; Cash Controller  responsible for internal controls Annual Conference 2012 : The Internal Auditor Valued Added to Audit Committee and Management  Crucial to set the role and parameters of the Internal Auditor in the Internal Audit Charter  Key Reference Point is the Definition set by the Institute of Internal Auditors.

Internal Auditing Defined  Definition of the Institute of Internal Auditors: Internal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization's operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes. must be Autonomous to ensure Independence and Objectivity Provides the 3 rd Level of Defence, behind the 2 Management Levels a disciplined approach to evaluate & improve RM & Internal Control designed and geared to ADD VALUE Annual Conference 2012 : The Internal Auditor Valued Added to Audit Committee and Management an Assurance & Consulting activity – not an Executive Function

Evolving Role  ….. Therefore the evolution of Internal Auditing must be continuous to ensure sustained value added.  a shift which requires new aptitudes, soft skills and versatile internal auditor professional profiles.  Still the core role of providing independent, objective assurance remains intact.  ….. by definition Internal Auditing must be geared towards providing value.  Shift from the ‘policing role’ to the ‘enabler’ role. Annual Conference 2012 : The Internal Auditor Valued Added to Audit Committee and Management  It is not an end in itself, but a means to an end.  …. However Value Added goes beyond policing.

Evolving Role  Ultimately, the key to ensuring Value Added is not just to stop at “Problem Finding” but to contribute towards “PROBLEM SOLVING (and mitigation)”  i.e. Providing assurance and Facilitating the Business Process  … Hence, the ‘CONSULTATIVE ROLE’ that must be mastered by an Internal Auditor in the evolution of the profession LET US DEBATE Annual Conference 2012 : The Internal Auditor Valued Added to Audit Committee and Management

Today’s Agenda  Presentations by - Professor Jean Pierre Garitte - Mr Franco Azzopardi  Networking Session  Interactive Panel Discussion Annual Conference 2012 : The Internal Auditor Valued Added to Audit Committee and Management