IIA Annual Seminar 2012

Aligning Internal Audit to deliver value

9 August 2012

www.pwc.com/th

PwC

Agenda

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• The rising importance of risk management

• Stakeholder expectations of internal audit

• Rising to the new floor

• What this means for your business

• Questions

The rising importance of risk management

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The rising importance of risk management

In todays’s ever-shifting risk landscape, internal audit can’t settle for simply reacting to events; instead, it must adopt a strategic mindset that is responsive to risks and helps ready organizations for new threats and opportunities

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The 15 most cited risks

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How well organizations manage each of these risks

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Least and most well-managed risks by industry groups

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Importance of internal audit’s contribution to monitoring each risk

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Stakeholder expectations of internal audit

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Stakeholder expectations of internal audit

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As the risk landscape shifts rapidly, CAEs and stakeholders must work to stay aligned both on the impact of this risk to their organization and on the specifics of the role internal audit should play.

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Risks that receive too little attention from internal audit

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Risk areas in which stakeholders and CAEs want/plan to add internal audit capabilities

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Three lines of defense

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Rising to the new floor

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Rising to the new floor

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Risks have shifted and expectations have risen, and all internal audit functions need to rise to this new floor; providing assurance on a broader range of critical risks

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Rising to the new floor

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Meet the challenge of a higher floor

•Think and act strategically

•Leverage the second line of defense

•Align resource allocations

•Understand the business

•Leverage specialists

•Deliver advice and best practices

•Build trust through ongoing dialogue

•Simplify reporting, make it consumable

•Connect the dots

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What this means for your business

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Internal audit functions need to meet higher expectations, as the floor has risen

• Align the scope of work and allocation of resources to the organization’s most critical risks through comprehensive, top-down risk assessments

• Hold ongoing, robust dialogues with stakeholders• Leverage and coordinate with the organization’s other risk

management and compliance functions• Lend expertise to enable the organization to enhance its

second line of defense if it is not already robust• Provide stakeholders advice on risk s and controls that

improve business performance• Communicate complex matters in a clear, consumable

fashion, with summaries of recurring themes and deeper, interpersonal interaction with stakeholders

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Internal audit functions need to meet higher expectations, as the floor has risen

• Ensuring stakeholder sponsorship on the importance of the CAE role and positioning the function

• Ongoing dialogue stakeholders with a mindset of enabling the business to function better

• Face the talent and resource shortage challenge head on

With the risk landscape shifting under their feet, internal audit functions must follow the same path, transforming and strengthening the floor form which they operate and becoming the partner stakeholders increasingly want and expect

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Thank you

© 2012 PricewaterhouseCoopers ABAS Ltd. Al l ri ghts reserved. "PricewaterhouseCoopers" and/or "PwC" refers to the indi vidual members of the PricewaterhouseCoopers organisation in Thai land, each of which is a separate and independent legal entity. Please see www.pwc.com/s tructure for further detail s.

Varunee PridanondaPartner – Governance, Risk and Compliance and Internal Audit ServicesOffice: 02 344 1282Mobile: 081 645 0114Fax: 02 286 4440Email: varunee.pridanonda@th.pwc.com

Should you need to discuss in more details, please contact;