I
agree with you Tracey, except in approach. You note that to add value your
projects are much bigger and all encompassing. I think for a risk based
approach to work, the audits performed are becoming more specific and
directed. I think that large projects tend to reduce the effectiveness of
an auditors time because you are not focusing in on the problem at hand. I
tend to break up large projects into multiple auditable units and then apply my
risk criteria to the pieces and focus on those with higher risk.
This
is all probably because I have only a two man staff and time is what I am
measured on.
Thanks.
Joseph A. Rychalski
Director, Internal Audit
Development
Corporation for Israel
646-319-4512
212-446-5828
-----Original Message-----
From: Tracey Sadler [mailto:[EMAIL PROTECTED]]
Sent: Friday, April 05, 2002 8:36 AM
To: [EMAIL PROTECTED]
Subject: RE: Internal Audit key performance indicatorsI agree with Sharon. I don't think number of frauds uncovered is a good indicator of success. Most frauds are discovered by someone turning someone else in. Few frauds are discovered through audits.Some better indicators and, here's today's buzzword, "value added auditing" may include risk covered. What does your CEO, CFO and Board think the highest risks are for the company that need to be controlled? Were you able to address realistic concerns, assure them those risks are controlled to an acceptable level? As a bonus for performance, have you discovered any major inefficiencies? Be careful with this, finding operations are efficient in the organization is not the same as not finding inefficiencies. Has audit adjusted quickly and easily to the changing risks that organizations face? What indicators would you use to determine you needed new audit resources, either people or programs?Other good sources you may want to consider for ideas to present to your CEO includes IIA Standards.We are a large university system audit department. We provide audit services to 9 universities and 11 agencies. To add value, our department was reorganized about 2 years ago. The reorganization was a huge step in the right direction. After working with the CEOs and Board, our projects are much bigger and all encompassing. We actually have fewer projects, but we make better recommendations. We are now making recommendations to improve efficiencies, lower controls in some areas, and in one case, we even stated management did not understand or take responsibility for internal control.I hope this helps.Tracey Sadler, CIA, CGAP
Senior Internal Auditor
System Internal Audit
Texas A&M University System
1200 TAMU
College Station, TX 77843-1200
Phone: (979) 845-3476
Fax: (979) 845-6536
email: [EMAIL PROTECTED]-----Original Message-----At 01:45 PM 4/5/02 +0200, you wrote:
From: Sharon Haapala [mailto:[EMAIL PROTECTED]]
Sent: Friday, April 05, 2002 7:12 AM
To: [EMAIL PROTECTED]
Subject: Re: Internal Audit key performance indicators
My Boss who is the CEO would like me to come up with key performance
indicators against which h would measure my performance.
In my proposed indicators l have included such things as no
of reports, recommendations implemented, budget performance, achieving set
plan etc. This to him is not sufficient and he wants me to include such
things as No. of frauds unravelled compared to previous years in dollars and
quantity terms, reported against those determined by audit, etc. Can you
suggest more indicators for me please.
I'd be very interested in hearing more ideas in this area. Some of the indicators mentioned above make me a bit nervous. I'm a university auditor, and some years I may not complete as many audits as other years, simply due to the nature of the audits - how long they take, complicated issues that might arise. Similarly, I don't find fraud every year - we're a small university that has excellent internal controls and audit trails. If I had fewer audit reports issued and no frauds, would that mean I'm doing poorly?
Just food for thought - please share any info you receive.
Sharon
Sharon J. Haapala, CIA, Auditor
Internal Audit Department
Michigan Technological University
906-487-1994
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