Internal_Audit_Performance.ppt - Oregon.gov Home Page
- Internal Auditing
Committee on Performance
Excellence, August 18, 2009
Presented by: DAS Chief Audit Executive - Pamela J. Stroebel Valencia, CPA, CIA
Introduction to internal auditing;
Comparison of external and internal auditing;
Overview of internal audit’s role in performance
Current state of internal auditing in Oregon State
Definition of Internal Auditing
Internal auditing is an independent, objective
assurance and consulting activity designed to
add value and improve an organization’s
operations. It helps an organization accomplish
its objectives by bringing a systematic,
disciplined approach to evaluate and improve
the effectiveness of risk management, control
and governance processes.
– The Institute of Internal Auditors,
International Professional Practices Framework
Internal versus External
Objectives and Audience vary slightly:
Internal audit’s primary objective is providing
information to improve decision making and
its audience is Management;
External audit’s primary objective is
accountability and its audience is the taxpayer
Internal versus External
Audit work performed is similar:
InternalAuditors are primarily performance auditors;
Most financial auditing is performed by external (i.e.
Oregon Audits Division performs Single Audit of
Both may instigate or become involved in special
reviews and investigations;
Law and standards require both groups to coordinate
and work together.
Program effectiveness or efficiency
Internal auditors assess risk across their entire
From this risk assessment, audit topics are
Additional criteria may be applied (i.e. last
audited, auditable, expertise available,
The Audit Committee approves the annual risk-
based audit plan.
The combination of processes and
structures implemented by the board
(management) in order to inform, direct,
manage, and monitor the activities of the
organization toward the achievement of its
Internal auditors are required by law and
standards to audit Governance.
It is important for management to be able to link
their strategic plan, performance measures, risk
assessment, and budget in order to make
effective business decisions.
Helping management determine if they are
effectively measuring their key strategic
objectives accurately can be an important role
for internal auditors.
Governance audit topics may include:
Governance structures, policies, charters
Ethics, culture and values of the organization
Strategic planning and decision making
Risk management structures and policies
Fraud control and policy
Enterprise web page content
Compensation policies and content
Governance, ethics and potential for fraud should be considered in
ALL audit engagements.
Internal auditors should work with management to ensure
recommendations resulting from audit findings are reasonable, add
value and are cost-effective.
Governance of Internal Audit
Agency Audit Committee
Provides oversight and increased independence to
the internal audit function.
Statewide Audit Advisory Committee
Mission: Promote excellence and professional,
standards-based internal auditing services in state
Membership includes: DAS Director, Director of
Audits Division, Legislative Fiscal Officer’s designee,
and representatives of agency Management, Chief
Audit Executive, and private sector.
Internal Audit Capacity in
Currently, 31 state agencies meet the criteria
established in Oregon Administrative Rule by
DAS which requires an internal audit function
(FTE, biennial expenditures, cash processed
28 agencies have an established internal audit
function or are meeting the requirement through
For further information:
Pamela Stroebel Valencia, DAS Chief Audit
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