1. INTERNAL AUDIT SERVICE of the REPUBLIC OF CYPRUS
Company LOGO
INTERNAL AUDIT SERVICE
of the
REPUBLIC OF CYPRUS
Katerina Demetriadou Paphiti
Internal Audit Officer A’
September 2016 1

2. 1) Internal Audit Act (2003 and 2014)
Company LOGO
1) Internal Audit Act (2003 and 2014)
Approved by the House of Representatives in July 2003, amendment in December 2014.
The Law provides for:
The appointment of the Commissioner of Internal Audit and his/her duties.
The establishment of the Internal Audit Board and its duties.
The establishment of an independent Internal Audit Service.
The obligations of audited organisations and the respective offences. 2

3. 1) Internal Audit Act (2003 and 2014) – Commissioner of Internal Audit
Company LOGO
1) Internal Audit Act (2003 and 2014) – Commissioner of Internal Audit
Head of the Internal Audit Service – term of office for a period of six years and may be renewed for one additional term.
Prepares Strategic Plan for the Internal Audit Service.
Prepares Annual Audit Plan for the Internal Audit Service.
Is responsible for the preparation and submission of an Audit Report to the management of the organisation that was audited.
Submits within six months from the end of each year an Annual Report to the Internal Audit Board describing the activities performed by the IAS during the previous year. 3

4. 1) Internal Audit Act (2003 and 2014) – Commissioner of Internal Audit
Company LOGO
1) Internal Audit Act (2003 and 2014) – Commissioner of Internal Audit
The Commissioner is responsible for carrying out the internal audit function for all government organisations.
According to the Art. 2 of the Law, Internal Audit means:
«An independent, objective and consulting activity designed to add value and improve the operations of government organisations. It helps an organisation to achieve its objectives through a systematic and disciplined approach in order to assess and improve the effectiveness of risk management, management and control systems and governance procedures.» 4

5. 1) Internal Audit Act (2003 and 2014) – Commissioner of Internal Audit
Company LOGO
1) Internal Audit Act (2003 and 2014) – Commissioner of Internal Audit
Government organisations:
According to Art.2 of the Law, government organisation means the Public Service under the control of the Republic and includes the Public Educational Service, the Police, the Army, the National Guard but does not include:
(a) the President of the Republic the House of Representatives and the High Court or any Court under its jurisdiction.
(b) the Attorney General, the Auditor General and the Public Service Committee for actions in relation to their Constitutional duties. 5

6. 1) Internal Audit Act (2003 and 2014) – Commissioner of Internal Audit
Company LOGO
1) Internal Audit Act (2003 and 2014) – Commissioner of Internal Audit
For this purpose the Commissioner has the authority to:
examine and evaluate the adequacy and effectiveness of internal control systems,
examine and evaluate the systems that have been set to ensure compliance with policies, procedures, legal obligations and regulations,
examine and evaluate the economy, efficiency and effectiveness of the various activities and procedures,
conduct special investigations and audits on any subject that affects the integrity, loss of revenue, interests and operational effectiveness of the Public Service. 6

7. Company LOGO
1) Internal Audit Act (2003 and 2014) – Suspicion of possible fraud or irregularity
According to Art. 12 of the Law:
«If, during an audit, circumstances are revealed that raise suspicion of possible fraud or irregularity or significant damage on the assets of the auditee or the state, the Commissioner is required to take immediate action to stop such an activity. In such a case, a special report will be prepared and submitted immediately to the relevant authorities» 7

8. Company LOGO
1) Internal Audit Act (2003 and 2014) – Internal Audit Board: Establishment
The Board is appointed by the Council of Ministers for a period of three years and is composed of five members (Αrt. 15):
The Minister of Finance - Chairman
The Minister of Labour, Welfare & Social Insurance
The Minister of Transport, Communications & Works
The Accountant General of the Republic
A person with experience on internal audit matters who is not a public officer. 8

9. 1) Internal Audit Act (2003 and 2014) – Internal Audit Board: Duties
Company LOGO
1) Internal Audit Act (2003 and 2014) – Internal Audit Board: Duties
To safeguard the independence of the Internal Audit Service.
To observe the results of the Internal Audit Service and inform the Council of Ministers accordingly.
To suggest measures to the Council of Ministers for the strengthening of the internal audit function in the public sector.
4. To request from the Management of the audited organisations to provide explanations in cases they do not respond to their obligations towards the Internal Audit Service.
5. To receive the Annual Internal Audit Plan and the Strategic Plan of the Internal Audit Service.
6. To decide for the distribution of the Annual Internal Audit Report. 9

10. 1) Internal Audit Act (2003 and 2014) – Internal Audit Service
Company LOGO
1) Internal Audit Act (2003 and 2014) – Internal Audit Service
Conducting of Audits (Art. 9)
The Internal Audit Service conducts audits on any activity, of any government organisation and for this purpose may follow any methodology and approach it deems appropriate.
Independence (Art. 10)
The Commissioner and the Internal Audit Service are independent from the auditee and must not have any direct responsibility or power over, the operations to be audited or take part in any executive decision. 10

11. 1) Internal Audit Act (2003 and 2014) – Internal Audit Service
Company LOGO
1) Internal Audit Act (2003 and 2014) – Internal Audit Service
Authorisation (Art. 11)
The Internal Audit Service has authority to:
have access, in a reasonable time, in all books, documents, accounts, property, payment vouchers, files, correspondence and other data necessary for performing the internal audit function.
enter into any building or other premises and ask from any officer to provide all the information and all the explanations deemed necessary for forming an opinion. Each officer shall respond timely in providing such explanations. 11

12. 1) Internal Audit Act (2003 and 2014) – Obligations of organisations
Company LOGO
1) Internal Audit Act (2003 and 2014) – Obligations of organisations
The management of each organisation that has been audited is obliged within one month from the date of submission of the audit report, unless the Commissioner specifies otherwise, to submit to the Commissioner a timetable with the measures they intend to take in relation to the audit findings. 12

13. 2) Organisation Structure
Company LOGO
2) Organisation Structure
The Internal Audit Service to be able to meet its obligations and responsibilities has been organised in the following departments:
Internal Audit Department for Public / Government Services (Section Α΄ and Β΄) – Consultant of the Republic
Department of Audit of Programmes Co-funded by the E.U. – Partner of E.E. as Audit Authority 13

14. Organisation Structure - Today14

15. Internal Audit Department for Public / Government Services
Company LOGO
Internal Audit Department for Public / Government Services
Internal Audit Department for Public / Government Services – Section Α΄ engages in:
issues relating to the Internal Control Units set up in ministries under the relevant Ministerial Decisions and Art. 80 of the Law which provides for the Fiscal Responsibility and the Financial Framework [N.(20(I)/2014].
conducting specialised ΙΤ audits and penetration tests of computerised systems in Government Services.
conducting assignments on “horizontal” matters across the public service. 15

16. Internal Audit Department for Public / Government Services
Company LOGO
Internal Audit Department for Public / Government Services
Role of Internal Control Units are distinct with respect to the role of the IAS.
The Internal Control Units should act as safeguards (internal control – 2nd line of defense) and the IAS conduct the internal audit (3rd line of defense). 16

17. Internal Audit Department for Public / Government Services
Company LOGO
Internal Audit Department for Public / Government Services 17

18. Internal Audit Department for Public / Government Services
Company LOGO
Internal Audit Department for Public / Government Services
The Internal Audit Department for Public / Government Services – Section Β΄ is mainly responsible for the internal audit and assignments on “horizontal” matters across the public service. 18

19. Department of Audit of Programmes Co-funded by the E.U.
Company LOGO
Department of Audit of Programmes Co-funded by the E.U.
In addition to the responsibilities provided by the Internal Audit Service for conducting internal auditing in Government Services, as defined in the Act, the IAS has been appointed as the independent Audit Authority for Projects co-financed with EU funds based on Decisions of the Council of Ministers.
As Audit Authority under the Community Regulations, IAS is responsible for conducting project and system audits on operations and on the Management and Control Systems.
Generally, the audits cover projects implemented with co-financing from the Structural Funds and the Cohesion Fund, the European Fisheries Fund, the Solidarity Funds and Financial Mechanisms EEA - Norway. 19

20. Contact us Commissioner of Internal Audit: Ms Anna Zavou Christoforou
Company LOGO
Contact us
Commissioner of Internal Audit: Ms Anna Zavou Christoforou
Address: Mailing address:
13 Limassol Avenue, P.O. Box 23812,
2112 Aglantzia, Nicosia Nicosia
CYPRUS CYPRUS
Τel:
Fax:
Website: 20

21. Company LOGO
Thanks 21