Matakuliah
Tahun
Versi
:A0274/Pengelolaan Fungsi Audit
Sistem Informasi
: 2005
: 1/1
Pertemuan 9
Department Organization
1
Learning Outcomes
Pada akhir pertemuan ini, diharapkan mahasiswa
akan mampu :
• Mahasiswa dapat menjelaskan
department organization.
2
Outline Materi
• Introduction
– Strategic Objectives
• Mission Statement
• Why a Procedures Manual
• Major Challenges of the department
–
–
–
–
–
Essence of Internal Auditing
Quality Assurance Reviews of Internal Audit
Outsourcing Internal Audits
Control Self-Assessment
Integrating the Auditing Process
• Corporate Audit Charter
3
Introduction
• In order to achieve the goal of a worldclass internal audit organization,
standardized procedures must be
developed and followed by the staff.
4
Strategic Objectives
• Internal audit consists of people and
procedures.
5
Mission Statement
• From the mission statement, the internal
audit department (in conjunction with
management) should establish strategic
objectives to reach the mission.
6
Why a Procedures Manual
• The mission statement, objectives, goals
and procedures of the internal audit
department need to be documented in
such a way that the resulting document
can be used as a reference manual.
7
Major Challenges of The Department
• In most cases, the procedures involve reviewing
and evaluating controls, efficiency, effectiveness
and other aspects of the business. Efficiency
generally relates to measures of operations or
delivery of services, especially as a ratio of
inputs to outputs. Effectiveness is a measure of
how well the organization meets its goals.
Effectiveness usually focuses on strategy and
improvements to decision making.
• Auditor productivity requires the development of
a proactive spirit, a high degree of
professionalism and measurement techniques,
including budgets and time reporting.
8
Essence of Internal Auditing
• One of the major challenges of audit
management is contributing to the
organization’s mission. It is often noted
that internal auditors do not create,make,
find or deliver the organization’s products
or services.
• Company management will periodically
examine the contribution of the internal
audit program.
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• Measuring efficiency in internal audit is
generally a simple and feasible process.
• Measuring the inputs – labor hours or
some other quantitative measure – is
relatively simple.
• But outputs need to take on relevance to
the organization rather than a simple
number of audits conducted or ignoring
outputs and simply quantifying inputs.
• Effectiveness is quite different.
10
• Based on the definition of effectiveness,
management of internal audit should first
establish a reasonable, achievable and
relevant mission statement, with
appropriate accompanying goals and
strategies (both must be measurable).
• This mission should be compatible with
the organization, culture, management’s
goals and objectives, and professional
responsibilities.
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• Then effectiveness becomes a measure of
how well internal audit accomplishes the
mission, as measured by how well it is
reaching its goals associated with the
mission statement.
• This measure is the one with which
corporate management will be most
concerned.
12
• To function effectively, internal auditors
and the customers of audit services should
possess a similar understanding of what
makes internal auditing a value-added
activity.
13
Quality Assurance Reviews of Internal
Audit
• Recently, quality assurance reviews of
internal audit functions have been on the
rise. This internal or external review is a
very positive development for internal
auditing as a profession.
14
Outsourcing Internal Audits
• As noted earlier, internal auditing
management requires a proactive
approach, good personnel, personal
development programs, structured
procedures, a mission, short-term and
long-term objectives, quality assurance
reviews, productivity measures and so on.
• Audit contribution is very difficult to
measure!
15
Control Self-Assessment
• Most line managers are concerned about
controls over their operations and have a basic
knowledge of control issues related to their
function of operation.
• In the current marketplace, all organizations are
affected by global competition, as well as
demands for greater accountability. Customerfocused organizations are attempting to
reengineer systems and eliminate activities that
do not add value to customers.
16
Integrating The Auditing Process
• The core process in an internal auditing
function is the auditing process.
17
Corporate Audit Charter
• Audit departments should operate
pursuant to a written charter indicating the
purpose, authority, duties and
responsibilities of the function.
18
Policy Statement
• The Audit Department will review the
effectiveness and efficiency of operations
and organization structures.
19
Responsibility of The Director of
Auditing
• The Director of Auditing is responsible for
properly managing the department so that:
– Audit work fulfills the purposes and
responsibilities established herein
– Resources are efficiently and effectively
employed
– Audit work conforms to the Standards for the
Professional Practice of Internal Auditing.
20
Reporting and Relationship of Audit
Committee
• The Director of Auditing will report to the
Audit Committee for approval of audit
scope, policy and administration. The
Director will report in writing on all internal
reviews conducted in the Corporation and
will attend the Committee meetings to
report on significant recommendations and
the operations of the internal audit
function.
21
Independence
• Independence is essential for effective
operation of the internal audit function.
22
Scope of Audit Activities
• Audit coverage will encompass, as deemed
appropriate by the Director of Auditing,
independent reviews and evaluations of any and
all management operations and activities to
apprise:
– Measures taken to safeguard assets including tests of
existence and ownership as appropriate
– The reliability, consistency and integrity of financial
and operating information
– Compliance with policies, plans, standards, laws and
regulations that could have significant impact on
operations
– Economy and efficiency in the use of resources
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– Effectiveness in the accomplishment of the
mission, objectives and goals established for
the Corporation’s operations and projects.
24
Access and Confidentiality
• In accomplishing activities, the Directors of
Auditing and their staffs are authorized to have
full, free and unrestricted access to all
Corporation functions, activities, operations,
records, data files, computer programs, property
and personnel.
• It is expected that Directors of Auditing and their
staffs will exercise discretion in the review of
records to ensure the confidentiality of all
matters that come to their attention.
25
Responsibility for Corrective Action
• The manager or head of the division,
department, unit or site audited is
responsible for either planning or taking
corrective action on recommendations
made or deficient conditions reported by
auditor.
26
Limitation of Authority and
Responsibility
• In performing their functions, the Director
of Auditing and corporate audit staff
members have neither direct authority
over, nor responsibility for, any of the
activities reviewed.
27
The End
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