1. Module 5.1: Internal Audit
INTRODUCTION TO
PUBLIC FINANCE MANAGEMENT
Module 5.1: Internal Audit

2. Internal audit is part of the executive
political
Parliament
External audit
Internal audit
management
Internal control
Public Expenditure Analysis and Management Course Zimbabwe 2014

3. What is Internal Audit?
Operationally independent unit checking that internal controls are working properly and making recommendations for optimization of controls.
General Financial Inspectorate
reviews transactions, accounts and organisations;
compliance - financial laws & regulations;
corrective – analyse problems & recommend change;
reports to the Ministry of Finance.

4. Module outline
Compliance & Systems Audit
Features of Internal Audit

5. Compliance & Systems Audit
Compliance with rules and regulations
Easier to identify irregularities than poor internal control
Systems
Examines system of Internal controls, checks and balances

6. Compliance & Systems Audit
Internal audit’s scope should include the entity’s systems, procedures and locations;
Internal audit should audit internal control systems, risk management and corporate governance procedures;
Plan to cover the most significant (risky) systems each year.

7. Module outline
Compliance & Systems Audit
Features of Internal Audit

8. Features of Internal Audit
Independence of Internal Audit
Report direct to the Permanent Secretary or Chief Executive;
Single department in the Ministry of Finance, headed by a director;
Independent of the Accountant General.

9. Features of Internal Audit
Internal Audit requirements
There should be a requirement for all organisational units to have/be covered by internal audit.
Audits seen as part of internal control & managerial support;
Audits pre-planned and agreed except in exceptional circumstances e.g. checking on suspected theft or misuse of assets.

10. Features of Internal Audit
Internal Audit Reports
Management reports – not made public
Institute of Internal Auditors (IIA) is a global professional body that offers resources and training

11. Key messages Internal Audit is part of the Internal Control System.
It is a management function.
Compliance and Systems Audits are both important.
There is a professional body for Internal Auditors.