Beyond Audit: Auditing Remotely and Delivering Value

Preface xi

Acknowledgment xv

About the Author xvii

Chapter 1: What Happened 1

Audit Execution Challenges 2

Understanding Your Role 5

Critical Meeting Keys 7

Chapter 2: Understanding the Remote Approach 11

Traditional versus Remote Audit 11

Recognizing the Challenges 14

Responsibility Assignments 18

Communicating Critical Information 19

Audit Planning 22

Audit Fieldwork 24

Audit Reporting 25

Audit Wrap-Up 26

Chapter 3: Marketing the Internal Audit Department 29

Creating Your Audit Brand 29

Defining Internal Audit 30

Internal Audit’s Three Pillars 32

Explaining the Audit Phases 34

Dispelling the Myths 38

Chapter 4: Building an Effective Audit Team 41

Beyond Audit Learning Map 42

Skills Focus in the Remote Environment 44

Remote Business Partner Meetings 49

Agendas Drive the Meeting 50

Audit Status Memos 53

Remote Auditor Skills Profile 54

Beyond Audit Development Plan 59

Chapter 5: The Methodology – Objective Recognition 61

Improving the Audit Process 61

Beyond Audit – ORC Model 62

Identifying the Business Objective 66

Business Objective Identification Challenge 69

Business Objective Identification in a Remote Audit 70

Business Process Risks 73

Business Process Controls 75

Completing the Audit Planning 77

Chapter 6: Audit Fieldwork 79

Fieldwork Communication 82

Fieldwork Responsibilities 84

Workpaper Requirements 85

Beyond Audit – Baseline Workpaper Components 86

Sufficient Evidence 91

Workpaper Self-Review and Keys 93

Beyond Audit – Top 10 Keys to Managing Fieldwork 93

Chapter 7: The Methodology – Partner Results 101

Communicating Audit Results 101

Understanding the Audit Report Phase 102

Audit Report Foundation 104

Beyond Audit – Issue Discussion Keys 105

Audit Reporting throughout an Audit 106

Effective Internal Audit Report Components 107

Audit Report Challenges 119

Chapter 8: Internal Audit Value 121

Defining Real Action 122

Steps in Creating an Action Plan 125

Action Plan Adoption Process 130

CA Methodology Overview 132

Action Plan Tracking 137

Chapter 9: Internal Audit Dashboards 141

Dashboard Defined 142

Beyond Audit – DDIO Methodology 144

Audit Dashboard Functions 154

Audit Dashboard – Lessons Learned 159

Chapter 10: Communication Focus 161

Understanding the Communication Model 162

Message Delivery 165

The Value of Listening 168

Beyond Audit Advisor Approach 169

Internal Audit Relationships 173

Beyond Audit – Internal Audit Marketing 178

Beyond Audit – Meeting Facilitation Keys 179

Chapter 11: Analyzing Internal Audit 181

Beyond Audit – ARB Methodology 182

ARB Conclusion 197

Chapter 12: How Good Is Audit? 199

Introducing the Top Ten 200

Creating an Action Plan 220

Chapter 13: Focused on Learning 221

Remote Learning 222

Index 227

Robert L. Mainardi (Cape May, NJ) is President of Mainardi & Associates, a firm that creates, develops, facilitates, and administers custom training programs in auditing and risk. Prior to forming his own firm, he was a Vice President with Penn Mutual Life Insurance where he managed the audit operations, staff, and business relationships for the life, brokerage, investment, and trust and mutual fund businesses. In addition, he has been a Senior Audit Manager with The Vanguard Group, Audit Consultant with Aetna U.S. Healthcare, Audit Director at Prudential Insurance Company of America, Senior Financial Auditor at Advanta Corporation, and Internal Auditor with GMAC Mortgage Corporation. He is an active member of the IIA and served as an IIA Philadelphia Chapter Board Member. Mainardi received a BS in Accounting and Business Law from Pennsylvania State University and an MBA in Finance from Temple University. He has also merited the Six Sigma Green Belt certification.