campus audits: chancellor’s office guide to survival janice mirza – senior director, office of...
TRANSCRIPT
Campus Audits: Chancellor’s Office Guide to Survival
Janice Mirza – Senior Director, Office of the University Auditor
Academic Resources Council - April 2, 2009
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Presentation Overview
The Office of the University Auditor (OUA)
Types of Audits
What We Look For
How We Select and Schedule
Tips for Audit Survival
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OUA Organization Chart
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Mission Statement
The mission of the Office of the University Auditor is to assist university management and the Trustees in the effective discharge of their fiduciary and administrative responsibilities by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes.
This assistance is provided through a series of independent and objective operational and compliance audits, internal control reviews, investigation services, and consulting.
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Purpose and Authority
Education Code Section 89045, enacted by Chapter 1406 of the Statutes of 1969, provided for the establishment of an internal auditing function reporting directly to the Trustees of the California State University (CSU).
Subsection (b) of the Code states that the duties of this function/internal audit staff shall include, but not be limited to, auditing, reviewing, cost and system analysis, analyzing and recommending operating procedures for the California State University.
Subsection (c) of the Code states that management audits shall be made to determine the effectiveness and efficiency of the organization, operation, and procedures of each state university, each auxiliary organization, and the Office of the Chancellor.
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Artist: Jeff Leedyartthatmakesyoulaugh.com
“The Audit”
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General Types of Audits
Operational Audits - Examine the use of unit resources to evaluate whether those resources are being used in the most effective and efficient manner to fulfill the University's mission and objectives. An operational audit may include elements of the other audit types listed below.
Financial Audits - Focus on accounting and reporting of financial transactions, including commitments, authorizations, and receipt and disbursement of funds. The purpose of this type of audit is to verify that there are sufficient controls over cash and cash-like assets, and that there are adequate process controls over the acquisition and use of resources.
Compliance Audits - Review adherence to laws, regulations, policies, and procedures. Examples include federal and state law, Trustee policies, and chancellor's office directives. Recommendations typically call for improvements in processes and controls intended to ensure compliance with regulations.
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General Types of Audits (cont’d)
Information Systems (IS) Audits - Examine the internal control environment of automated information processing systems and how people use those systems. IS audits typically evaluate system input, output, and processing controls; backup and recovery plan; system security; and computer facility reviews.
Internal Control Reviews - Focus on the components of the university and auxiliary organization major business activities. Areas such as payroll and benefits, cash handling, inventory and equipment and their physical security, grants and contracts, and financial reporting are usually subject to review.
Investigations - Seek to establish evidence of impropriety; imply a systematic track-down of information the auditor hopes to discover or needs to know. Investigations include alleged instances of fraud, waste and abuse, and improper governmental activities.
Consulting Services - Add value and improves an organization's governance, risk management, and control processes without the auditor assuming management responsibilities. Consulting services may include counsel, advice, and facilitation.
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Types of Audits Within the CSU
Mandatory Audits
FISMA – Financial internal control reviews required as part of the Financial Integrity and State Manager's Accountability Act (FISMA) of 1983. Performed on a two-year cyclical basis on all campuses.
Auxiliary - Internal compliance/internal control reviews of each auxiliary organization, including segregation of duties, safeguarding of assets and reliability and integrity of information required by EO 698. Performed on a three-year cyclical basis on all campuses.
Delegations of Authority – Reviews of delegations of authority concerning purchasing and contracting activities, motor vehicle inspections, and real and personal property transactions to assure that CSU has acted responsibly under the Delegations of Authority established by SB 1828 (1986) and expanded by AB 1191 (1993). Performed on a five-year cyclical basis on selected campuses.
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Types of Audits Within the CSU
Other Audits
Subject Area – Selected annually via a risk assessment process. Audits can be of anything on a college campus and include operational, financial, compliance, information systems and internal control elements.
Construction – Selected on the basis of project size.
Investigations – Performed as the need arises.
Consulting Services – Performed as requested.
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Campus Selection and Audit Scheduling
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Campus Selection
FISMA audits – 12 per year.
Auxiliary audits – 8 per year.
Delegations of Authority audits – selected as noted below but only performed every 5th year.
10 campuses for each of three subject areas coordinated with above cyclical audits and consideration of campus size, prior audits, and management judgment.
Construction – selected based on project size and status of completion.
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Audit Scheduling
FISMA and Auxiliary audits based on prior audit dates with two months avoided for yearend close.
Subject area audits coordinated with cyclical audits to maintain adequate spread when multiple audits on one campus.
Construction audits sort of thrown in.
All audits scheduled to provide adequate mix of in-town and out-of-town assignments.
Scheduling impacted throughout the year by staffing changes, vacation requests, specific campus issues.
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Tips for Audit Survival
Be Proactive● Review your internal controls
● Review prior and similar audit reports
● Self Audit◙ Use policies and procedures as criteria for self-assessment◙ Create internal control/compliance checklists◙ Ensure prompt correction of errors and deviations from policies
and procedures
Have all requested documents ready at start of audit
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OUA Audit Reports
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More Tips for Audit Survival
Be positive, professional, and confident.
Listen carefully to questions and understand question before answering.
Keep answer simple and direct.
Be honest.
Understand that we are all working on the same team.
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Even More Tips for Audit Survival
Do not get offended by WHY questions.
Recognize that the auditors may be experts (they may have worked in the specialty area prior to becoming an auditor).
Realize that the auditors may not be subject experts (this may be their first audit – so be patient).
Understand that the auditors really are there to help.
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QUESTIONS
THANK YOU