1. Adding Value Across the Board
INTERNAL AUDITING:
Adding Value Across the Board

2. What is Internal Auditing?
Internal auditing is an independent, objective assurance and consulting activity that adds value to and improves 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.

3. Internal Auditors’ Roles
Risk management, control, & governance processes
Financial analysts
Risk evaluators
Improving operations
Supplying analyses, suggestions, & recommendations
Adding Value

4. A Valuable Resource…
Internal auditing is a valuable resource to executive management and the board of directors in accomplishing overall goals and objectives, as well as strengthening internal control and governance.

5. Risk Management
Internal auditors identify all auditable activities and relevant risk factors, and assess their significance.
Investigating
Evaluating
Identifying potential trouble spots
Communicating
Anticipating emerging issues
Identifying opportunities

6. Internal Controls Evaluate efficiency & effectiveness of controls
Recommend new controls where needed – or discontinuing unnecessary controls
Use of control frameworks (COSO, CoCo, Cadbury)
Control self-assessment
Provide education on risks and controls

7. Governance
Internal auditing provides assurance to management and the audit committee that risks are understood and managed properly.

8. Communications Keeping senior management aware of critical issues
Ensuring factual communications of financial and other data
Suggestions based on knowledge of operations throughout the organization

9. Analyzing Operations Internal auditors:
Review operations, policies, and procedures
Help ensure goals and objectives are met
Understanding of “big picture” and diverse operations
Make recommendations to improve economy and efficiency

10. Reviewing Compliance
Ensure management’s policies and procedures are followed
Analyze impact of changes in procedures
Assure compliance with laws & regulations
Review objectives for adherence to organization’s mission, culture, & climate
Provide insight to the impact of noncompliance

11. Assuring Safeguards Evaluate procedures to safeguard assets
Technological safeguards
Emerging issues

12. An Audit Committee Resource…
Internal audit is the primary resource of the audit committee in carrying out its duties and responsibilities. With those responsibilities increasing and continued pressure from the SEC for financial reporting integrity, a functioning partnership of the audit committee and internal audit is vital.
-BellSouth Corporation

13. An Audit Committee Resource…
Internal audit’s relationship to the audit committee is important to assure there are no organizational levels below the board of directors that could prevent necessary actions or appropriate decisions from taking place or being made to enhance business opportunities and mitigate risks.
- Asea Brown Boveri

14. An Audit Committee Resource…
An active and informed audit committee provides the ultimate independent and objective oversight of the corporate control environment, including focus on emerging trends and risks. Internal auditing is the primary agent of the audit committee within the company.
- Ford Motor Company

15. A Broad Perspective… Examining global issues
Assessing quality, economy, & efficiency
Providing accurate and timely communication
Evaluating emerging technologies
Analyzing opportunities

16. Essential Services
Internal auditing reviews the reliability and integrity of information, compliance with policies and regulations, the safeguarding of assets, the economical and efficient use of resources, and established operational goals and objectives. Internal audits encompass financial activities and operations including systems, production, engineering, marketing, and human resources.  Can you afford to be without it?

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