what is changing, why it’s changing, and the expected outcomes From the PPF to the IPPF

What is a framework? A framework is a basic skeletal structure for classifying and organizing concepts or various elements.

What is the PPF? Professional Practices Framework

What is the IPPF? International Professional Practices Framework

PPF and IPPF Both provide a structure for the internal audit profession’s technical guidance.

Why the change? Committed to delivering the most qualitative technical guidance for internal audit practitioners all around the world, The IIA wants to be internationally recognized as a trustworthy guidance-setting body.

The change ensures: More Clarity — what is authoritative, mandatory, and what is neither authoritative nor mandatory. More Transparency — throughout the process life cycle, development to maintenance. More Timeliness — in issuing guidance.

How is the IPPF different?

Key Differences Changes of scope and structure Development and maintenance process enhancements

Scope and Structure PPF This framework organizes all guidance developed and/or endorsed by The IIA. IPPF This framework organizes The IIA’s authoritative guidance.

ELEMENTS Definition Code of Ethics International Standards Practice Advisories Development and Practice Aids ELEMENTS Definition Code of Ethics International Standards Practice Advisories Position Papers Practice Guides PPF IPPF REMOVED Scope and Structure

Authoritative Guidance

The PPF ElementsDefinition Statement of fundamental purpose, nature, and scope of internal auditing. Code of Ethics Statement of principles and expectations governing behavior of individuals and organizations in the conduct of internal auditing. Description of minimum requirements for conduct. Describes behavioral expectations rather than specific activities. International Standards Mandatory requirements consisting of statements of basic requirements for the professional practice of internal auditing and for evaluating effectiveness of its performance, which are internationally applicable at organizational and individual levels. Principle-focused and provide framework for performing and promoting internal auditing. Includes Attribute, Performance, and Implementation Standards. Practice Advisories Practice Advisories represent best practices that may help to interpret the Standards or to apply them in specific situations. Practice Advisories are endorsed and highly recommended by IIA, but they are not mandatory. Many Practice Advisories are applicable to all internal auditors while others may be developed to meet the needs of internal auditors n specific industries, specialty or geographical areas. Development and Practice Aids The development and practice aids (DPAs) comprise a broad range of practical guidance in the form of professional development conferences and seminars, research reports, educational products, and other select products and services related to the professional practice of internal auditing. DPAs is largest and most diverse component of the Professional Practices Framework. Developed and/or endorsed by The IIA, these practical tools readily guide auditors through the maze of emerging and evolving internal audit processes and activities and provide best-practice tips and techniques that can be implemented along the way. Authored and/or presented by world-class practitioners, educators, and researchers, these aids dig deep beneath the surface to provide the most current guidance available on internal audit activities, issues, and approaches.

ElementsDefinition Statement of fundamental purpose, nature, and scope of internal auditing. Code of Ethics Statement of principles and expectations governing behavior of individuals and organizations in the conduct of internal auditing. Description of minimum requirements for conduct. Describes behavioral expectations rather than specific activities. International Standards Mandatory requirements consisting of: Statements of basic requirements for professional practice of internal auditing and for evaluating effectiveness of its performance, which are internationally applicable at organizational and individual levels. Principle-focused and provide a framework for performing and promoting internal auditing. Includes Attribute, Performance, and Implementation Standards. Interpretations, which clarify terms or concepts within the statements. Consider both statements and Interpretations to understand and apply correctly. Practice Advisories Address approach, methodology and considerations, but NOT detailed processes and procedures. Concise and timely guidance to assist internal auditors in applying Code of Ethics and Standards and promoting good practices. Includes practices relating to: international, country, or industry specific issues; specific types of engagements; and legal or regulatory issues. Position Papers IIA statement to assist a wide range of interested parties, including those not in internal auditing profession, in understanding significant governance, risk or control issues and delineating related roles and responsibilities of internal auditing. Practice Guides Detailed guidance for conducting internal audit activities. Includes detailed processes and procedures, such as tools and techniques, programs, and step-by-step approaches, including examples of deliverables. The IPPF

Process Enhancements IPPF Clarity, Transparency, Timeliness Detailed development processes Designated approval bodies Clarified voting rules Defined maintenance cycles Publicly documented on The IIA Web site

Process Enhancements IPPF oversight: An Internal Audit Standards Governance Board (IASGB) will be charged with reviewing the rigor and due process followed for the setting of Standards. The IASGB will include select members of the global IIA Board of Directors and persons representing major global organizations or regulators external to The IIA.

Are there any changes to the content?

Content Enhancements Six new Standards. Interpretations of existing Standards will enhance the understanding of current requirements. A cleansing of existing Practice Advisories will ensure consistency in writing style, tone, and presentation.

Content Enhancements Position Papers –The Role of Internal Audit in Enterprise-wide Risk Management –The Role of Internal Auditing in Resourcing the Internal Audit Activity GTAG GAIT

What will remain the same?

No Change The Definition of Internal Auditing remains the same and the Code of Ethics had one minor change to ensure consistent grammar.

Will a practitioner’s conformance be affected?

No Change Conformance with the Standards under the IPPF is equal and identical to conformance under the PPF.

IPPF Schedule Interpretations of the Standards were exposed the first quarter of The IPPF is scheduled for roll-out simultaneously in English, French, and Spanish, in January of The soft release of the Standards only is October 1st, 2008, to allow a three-month preview before the IPPF is effective. IPPF updates will be posted regularly to the Professional Guidance section of The IIA’s Web site.

Outcomes Improved Clarity –Reduced scope and clear definitions for elements Improved Transparency –Public accessibility to development processes and plans Improved Timeliness –Stringent maintenance and review cycles Improved Rigor and Accountability –Garnered respect beyond boundaries of the profession Continued Validity of current requirements –Consistency in regard to conformance with the Standards

From the PPF INTERNATIONAL

From the PPF to the IPPF INTERNATIONAL QUESTIONS?

This presentation was developed by IIA Global Headquarters.