3 september 2014 sonaliraut, ca, cisa dgm-internal audit ... webin… · reporting responsibilities...

3rd September 2014Sonali Raut, CA, CISA

DGM-Internal Audit, Voltas Ltd.

� Role and responsibility of Internal Audit

� Sharing of best practices◦ Model of operation

◦ In conduct of audit assignment

◦ Other functions of audit◦ Other functions of audit

� Conduct of meetings

� Actionables tracking

� Reporting to Audit Committee

� Team engagement

� Thoughts on best practices

03/09/2014 2IIA Webinar

� Reporting responsibilities to Audit Committee and management◦ Companies Act, 2013

◦ Institute of Internal Auditors

� Conduct and timely completion of audits� Conduct and timely completion of audits

� Organisational set-up of the function


� Adopt co-sourcing model instead ofoutsourcing

� Participation of Chief Internal Auditor (CIA)◦ in Closing meeting of every audit assignment

◦ Reports issued under CIA signature◦ Reports issued under CIA signature


� Planning

� Scheduling

� Execution ◦ Pre-audit

◦ Field work◦ Field work

� Closing of assignment


� Risk based Annual Audit Plan

� Based on inputs sought from◦ Audit Committee from time-to-time

◦ Business unit heads

◦ Chief Finance officer (CFO)◦ Chief Finance officer (CFO)

◦ Statutory auditors

◦ Past audit reports

� Circulation of annual calendar to all businessunit heads and CFO


� Communicate commencement and closingdates of audit well in advance◦ at least 10-15 working days in advance

◦ Recipients-direct auditees, regional heads, CFO

◦ Areas to be covered in audit◦ Areas to be covered in audit

◦ Audit objective and scope

� Model the number of days for pre-audit, fieldwork and review

� Circulation of day wise audit schedule

� Mock closing meeting


� Pre-audit◦ Walkthroughs with auditees

◦ Rounds of discussion of audit objective, scope andchecklist

◦ Procuring data from auditees for analysis andsample selectionsample selection


� Field work◦ Should start with an Opening meeting◦ Continuous interaction for sharing and resolving ofqueries with auditees◦ Continuous internal reviews with agreed timelines◦ Draft report circulation◦ Mock Closing meeting◦ Mock Closing meeting� Discuss observations� Seek draft management response◦ Pragmatic recommendations◦ Seek management responses in writing◦ Specific Action Plan and target date◦ Final Closing meeting◦ Release final report within 15 days of Closing meeting◦ Documentation


� Time bound and meeting invites for blockingof calendar

� Presentation-focused, crisp and engaging

� Feedback sessions◦ Auditees-on areas for improvement◦ Auditees-on areas for improvement

◦ Auditor-Give feedback to auditees

◦ Internal with team


� Track target dates for actions taken andreport status to Audit Committee on halfyearly basis

� Compliance testing during the next audit andhighlight deviations, if anyhighlight deviations, if any


� At least two Audit Committee meetings in ayear exclusively for discussion of internalaudit agenda

� Report significant audit findings� Advance review with management team ofpresentations to be madeAdvance review with management team ofpresentations to be made

� Papers of agenda sent at least a week inadvance

� Effective time management� Systematic follow-up on actionables of allaudit findings


� Retention of talent◦ Monthly meets of the team◦ Declaring a best performer of the month

� Encourage participation of team in the meets eg. presentation on topics of interest, academic or of professional interestacademic or of professional interest

� Annual off-site meet� Performance appraisal◦ Measurable goals◦ Appraisals are based on empirical data captured foreach assignment


� Some other good practices could be:� Use of tools for statistical sampling

� Rotation of high fliers in organisation

� Development of auditing and soft skills

� Involvement of audit team in process improvements

Continuous review and revisit of the internal � Continuous review and revisit of the internal audit practices adopted is the key


Thank YouThank You

[email protected]


3 september 2014 sonaliraut, ca, cisa dgm-internal audit ... webin… · reporting responsibilities...

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