Transcript Performance Auditing - Florida West Coast Chapter IIA

Solutions.
Character.
Depth.
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The Firm of Choice.
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Institute of Internal Auditors
Performance Auditing
Ron Conrad, Partner
Cherry, Bekaert & Holland, L.L.P.
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Course Objectives
• Discuss standards for performance
audits
• Discuss application of performance
audits among session participants
• Discuss practical applications and
situations encountered in performance
audits
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Objectives of Performance Audits
• Provide an independent assessment of
the performance
• Provide an independent assessment of
the management of a program
• Provide information to improve program
operations
• Facilitate decision making
• Improve public accountability
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Types of Performance Audits
• Assessing program effectiveness and
results
• Assessing economy and efficiency
• Assessing internal control
• Assessing compliance with legal
requirements
• Assessing analyses and other
information
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General Standards
• Independence
– Free in fact and appearance from
organizational, personal and external
requirements
– Internal audit is free of organizational
impairments if the head of the audit
organization is:
• Accountable to the head or deputy head of the
governmental entity
• Required to report audit results to the head or
deputy head of the governmental entity
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General Standards
(continued)
• Is located organizationally outside the staff or line
management function of the unit under audit
– Internal audit should be sufficiently removed
form political pressures to ensure objectivity
– Independence is enhanced if reporting to an
audit committee or oversight body
– Internal audit should document the
conditions that allow it to be free of
organizational impairments
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General Standards
(continued)
• Professional judgment
– Reasonable care and diligence
– Objective, independent, integrity
• Competence
– Adequate staffing
– Training
• Quality control and assurance
– Peer review every three years
– Policies and procedures
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Fieldwork Standards
• Work is to be adequately planned
– Understand the program
– Consider internal controls
– Design the audit
• Supervision is to be documented
• Evidence should be sufficient, competent
and relevant
– Findings should include the condition, effect,
cause and criteria
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Fieldwork Standards
(continued)
– Criteria are the standards, measures and
expectations of what should exist
– Condition is the situation that exists
• Audit documentation should be sufficient
to enable an experienced auditor, who
has no previous connection to the audit,
to ascertain that evidence supports the
auditors judgments and conclusions
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Reporting Standards
• Audit reports should include the
objectives, scope and methodology used
• Audit reports should include findings,
conclusions and recommendations
• Audit reports should reference GAGAS
and include views of responsible officials
• Audit reports should include the nature of
any privileged and confidential
information omitted
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Reporting Standards
(continued)
• Audit objectives, scope and methodology
– Identify the audit subject, why the audit is
performed, the depth of audit work
performed, the period covered, the
organizational unit audited, any limitations or
scope impairments, the relationships
between samples and what was audited and
how audit objectives were accomplished
– Report findings, conclusions, and
recommendations, criteria, condition, cause
and effect
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Reporting Standards
(continued)
– Views of responsible officials are normally
written. If oral, auditors should summarize in
writing and provide the summary to officials
of the audited entity
– When written views oppose the auditors’
findings, the auditors should state the
reasons for disagreeing with the written
views
– Report should be timely, complete, accurate,
objective, convincing, clear and concise
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Solutions.
Character.
Depth.
The Firm of Choice.
The Firm of Choice.
www.cbh.com