INTERNAL AUDIT AND BEYOND

A Quarterly E-newsletter of the Internal Audit Standards Board of the ICAI

The Institute of Chartered Accountants of India

(Set up by an act of Parliament)
Vol.2, Month: April -June, 2012

Editorial Board
Chairman, IASB CA. Rajkumar S. Adukia President, ICAI CA. Jaydeep N. Shah Vice President, ICAI CA. Subodh Kumar Agrawal Vice Chairman, IASB CA. Rajendra Kumar P. Editorial Support CA. Jyoti Singh Secretary, IASB

Message

Contents
Messages Composition of the Internal Audit Standards Board (2012-13) Articles Whats New Fraud Control Legislation and Policies New Batches of All the Certificate Courses offered by the Board New Publications of the Internal Audit Standards Board Significant Achievements of the Internal Audit Standards Board (2011-12) Invitation to Participate in the Activities of the Board Publications - Internal Audit Standards Board

Today, internal audit has expanded its activities to all operational areas and is increasingly advising organizations on governance processes and audit committee effectiveness. Internal audits understanding of the organisations key business processes provides the opportunity for continuous improvement. As the scope of the internal audit role has broadened, internal audit departments have been taking a number of steps to boost their performance. A major focus area is to leverage new technologies to cover more areas through data analytics. In other words its about being able to digest a huge amount of information and making sense of that in an efficient manner. The Internal Audit Standards Board of the Institute has been helping the members to update their skill sets so as to provide best services as internal auditors. The aim is to help internal auditors to be able to identify and critically evaluate the elements of governance and risk management in an organization; identify and understand how operational objectives link into the higher level objectives; understand the relationship between risk management and corporate governance; and be able to relate the organizations risk appetite to the appropriateness of controls and be able to undertake reviews to assess their effectiveness and report to management accordingly. The Board regularly issues technical literature on internal audit and recently the Board has issued Technical Guide on Internal Audit of Mining and Extractive Industry and Technical Guide on Internal Audit of Not-for-Profit Organizations(NPOs). This quarterly e-newsletter provides an update on latest developments, nationally and internationally, in the field of internal audit, internal control and risk management. We urge the members to give their contributions and suggestions for making this e-newsletter Internal Audit and Beyond an interactive platform for exchanging views and insights. CA. Rajkumar S. Adukia Chairman, IASB

Disclaimer
Opinions expressed by contributors are their own. Reproduction in whole or in part without permission is strictly prohibited.

Articles and Suggestions Your suggestions for improvement are most welcome. Send in your articles for E-newsletter at cia@icai.org.

Message

I am pleased to present to the members the second issue of quarterly e-newsletter of Internal Audit Standards Board - Internal Audit and Beyond. The business environment is highly dynamic. Factors such as competition, new technologies, changes in laws and regulations, are creating new opportunities and simultaneously bringing new risks for the organizations. It is important for the organisations to keep enough checks and balances for proper governance of the organisations. In the emerging scenario, the function of internal audit is playing key role. At the same time, it is important for internal auditors to ensure that their competencies and knowledge are up to date, so that they are able to render their services to the satisfaction of stakeholders. Greater competencies will improve the reliability of the internal auditor, allow the internal audit team to better anticipate and meet the changing needs of the organization and, in turn, boosts the reputation of the internal audit function as a whole. Being the hallmark of professionalism, the internal auditors understand the expectations of their role today and continue to demonstrate their true value to their organizations. The Institute through this quarterly e-newsletter aims to update its members on latest thinking and developments in the field of internal audit, internal control and risk management. Further, the Institute also offers a wealth of other resources to help members build their internal audit competencies and stay abreast of regulatory and other changes relevant to internal audit. After reading this e-newsletter, you may have some views or ideas. We look forward to your valuable feedback for making this e-newsletter more informative and useful. CA. Jaydeep Narendra Shah President, ICAI

Message

The function of internal auditing is very important for proper functioning of business organisations. An Internal auditor drives and is simultaneously driven by the corporate governance agenda of the organisations. In the past, internal auditors would define their roles and responsibilities by considering what they would enjoy doing and what fitted their skills set. Nowadays, the internal auditor can only really view their role by reference to social expectations and the challenge is inherent in the ability to judge how economic and business climate is changing. Internal audit professionals constantly encounter areas where they are expected to gain professional knowledge to assist them in performing internal audits. These knowledge areas come from industry developments, regulatory developments, technology changes or just good ideas developed through discussion at various forums. The bottom line, though, is that internal auditors at all levels are expected to have knowledge in a wide variety of areas, some unique to an individual enterprise or product area while others cover the general practice of internal auditing. This e-newsletter is one of an important initiative of the Institute to help the members remain updated on the latest developments in the field of internal audit, internal control and risk management. We are sure that the members would be benefited from this and other forthcoming editions of the e-newsletter so that they are able to follow best practices in every aspect of internal audit work. CA. Subodh Kr. Agrawal Vice President, ICAI

Message
It gives me great pleasure to come with this second issue of the quarterly e-newsletter of the Board Internal Audit and Beyond. Rapidly accelerating pressure fuel the need for internal audit to transform its thinking from financial controls-centric to shareholder value-centric and to drive efficiency into traditional internal audit processes. A transformed internal audit function has the potential to become that engine which is a force of old-fashioned due diligence that could help in managing the increasingly sophisticated risk factors that todays businesses face. This transformation offers internal auditors the chance to be part of a department that is energized, organized, and properly supported through skill sets, automation, and technology to better contribute to shareholder value. Accordingly, the responsibilities of the internal auditors are expanding and, consequently, the required skill sets are changing. This e-communiqu is full of thoughtful articles and consists of various latest information on the internal audit and related area that would surely be useful to the internal auditors. We are confident that these efforts of the Institute would enable the participants to appreciate their role in effective delivery of internal audit objectives and continuous improvement of the internal audit function.

CA. Rajendra Kumar P. Vice Chairman, IASB

Composition of the Internal Audit Standards Board (2012-13)

CA. Rajkumar S Adukia, FCA Chairman, Internal Audit Standards Board CA. Rajendra Kumar P. Vice Chairman, Internal Audit Standards Board CA. Jaydeep Narendra Shah President, ICAI CA. Subodh Kumar Agrawal Vice President, ICAI CA. Abhijit Bandyopadhyay CA. Amarjit Chopra CA. Anuj Goyal CA. Atul C. Bheda CA. Charanjot Singh Nanda CA. G. Ramaswamy CA. J. Venkateswarlu CA. Nilesh S. Vikamsey CA. Pankaj Tyagee CA. Ravi Holani CA. Shiwaji Bhikaji Zaware CA. S. Santhanakrishnan Shri Manoj Kumar Shri Prithvi Haldea Shri Sidharth Birla Smt. Usha Narayanan Shri Gautam Guha

Co-opted Members
CA. Porus Doctor CA. Masani Hormuzd Bhadur CA. Ghia Tarun Jamnadas CA. Deepjee A. Singhal CA. Nitin Alshi CA. Narendra Aneja CA. Guru Prasad M

About The Internal Audit Standards Board

The Internal Audit Standards Board (IASB) has been constituted as the Committee on Internal Audit in the year 2004, with the mission to reinforce the primacy of the Institute of Chartered Accountants of India as a promoter, source and purveyor of knowledge relating to internal audit and other aspects related to it so as to enable its members to provide more effective and efficient value added services related to this field to the industry and others and help the latter to systematize and strengthen their governance process by systematizing and strengthening their control and risk management process. The objectives of the Internal Audit Standards Board: i. ii. iii. iv. v. vi. To review the existing internal audit practices in India. To develop Standards on Internal Audit (SIAs) to be issued under the authority of the Council of the Institute. To develop Guidance Notes on the issues relating to internal audit, including those arising from the SIAs. To formulate clarifications on issues arising from SIAs. To undertake research in the field of internal audit. To organise/ provide technical assistance in, conferences, workshops etc., on the topics related to internal audit organised by the Institute 5

Data Analytics for Business Decision Making

Introduction
All the analytics in the world wont help unless we use them to make and execute better decisions. Entrepreneurs who realize this will ride the wave for times to come. Analytics and fact-based decisions establish trends for the ages to come. Other decision approaches will ebb and flow, but the progress towards factbased techniques are here to stay permanently. The writing is on the wall for us all to see We are becoming rational, analytical and datadriven in a far wider range of activity then we ever have been before. Better information systems facilitate better decisions. The first fifty odd years of the digital age were spent largely in capture of data. Now that entities are beginning to master analytics, they can better justify the utilization of the captured data sets. Let us begin by understanding the primer of fact-based decisions. Fact-based decisions employ objective data and analysis as the primary guides to decision making. The goal of these guides is to get at the most objective answer through a rational and fair-minder process, one that is not colored by conventional wisdom or personal biases. Whenever feasible, fact-based decision makers rely on the scientific method with hypothesis and testing and rigorous quantitative analysis. They eschew deliberations that are primarily based on intuition, gut feeling, hearsay, or faith, although each of these may be helpful in framing or assessing a fact-based decision. CA. Deepjee Singhal CA. Manish Pipalia business. Here are some of the reasons to jump onto the analytical band-wagon right away -

Better Strategic Decisions

If youre trying to conclude on buying or merging with another company, entering a new market or winning over a different customer type, you will benefit from analytical decision making. Strategic decisions need good intuition, but analytics will certainly help you make sense of the impact of imponderables on growth and profit.

Improved Tactical and Operational Decisions

Decisions on production, pricing, market segment and selling are decisions that recur frequently and are based on operations that creates tonnes of data. The systematic collection and analysis of data can yield tangible and cognizable savings per transaction and super profits over a dramatic time scale.

Enhanced Ability To Take On Problems Head-on

If your supply chain has more inventory than you would expect for the quarter, analytics can help with a solution. Hence if something is going wrong, gathering and analysing data on the underlying causes of the problems is the best way to get to its source. Analytics work the numbers and demystify the cause, let alone treat the symptoms.

Streamlined Business Processes

Embedding analytics into the underlying business processes is just good business. Processes are a structured way to think about

Positive side of Analytics

Analytics can yield significant benefits to 6

how work gets done. Analytics are a structured way to think about the decisions within those processes.

Be a catalyst for more data and greater analytics

Individuals who plan to hone leadership skills in analytics must set a tone for data and analysis amongst all their teams. Sloppy logic and uninformed intuition must make way for harddata analysis and related conclusions.

Decisions at the speed of analytics and consistent results

Analytics take time to develop at first instance. Once developed and set up, you can scale it and run it any number of times in shorts spans of time. By using analytic optimizers created by your experts, you can bet your bottom dollar that decisions will be made correctly and consistently across the board. Anticipate varying trends and market conditions Monitoring the outside business environment and its force-factors can provide a compelling early warning alert mechanism of shifting economic and market dynamics. Analytics bring opportunities to the fore and help predict changing customer tastes, loyalties and spending tendencies. Assumptions made under various analytical scenarios can be tested for their relevance and applicability on an on-going basis.

Lead from the front

Good analytical leaders set an example by crunching data in their own decisions.

Sign-up for Results

Seasoned analysts commit themselves to achieving a specific result in the part of the organization they serve or control.

Train
Budding analysts gently guide, orient and sensitize protgs into the analytical way of work.

Set Strategy and Expected Results

Analytical Leaders at the helm of affairs know that analytics and fact-based decisions do not happen in a vacuum. Defining metrics will itself drive the organization in a more sustained analytical direction and motivate employees to begin tools usage and decision making thereof.

Sharper Business Results

Its a known fact that entities which ride the analytic wave make better financial fortunes than their industry peers.

Traits of Analytical Leaders for Evolved Decision Making

Analytical leaders must demonstrate following traits abundantly the

Look for Leverage

Strong analytical leaders know where to apply leverage where a small improvement in a process driven by analytics can make a big difference in top line and bottom line figures.

Develop their People Skills

Analytical leaders must learn to develop a fine blend of the technical nuances and subtle people skills like sympathy and empathy.

Patient and Perseverant

Analytical leaders have to work doggedly and persistently for the long haul because changes that apply analytics to decision making, business 7

processes, information systems, culture and strategy hardly happen overnight.

Create an Analytical Ecosystem

Expert analysts build an ecosystem of employees, vendors, partners who work towards providing talent, advice, resources, tools and solutions to common problems.

like geographical proximities or protective regulation have been eroded by the sweeping effects of globalization. This leaves three key differentiators as the basis for competition efficient and effective implementations, intelligent decision making and the skill to cull-out every ounce of value from business processes all of which can be gained through the mature use of analytics. The time has come for each of us to Use data more intelligently to deduce critical business analytical insights. Build a framework of data, people and technology to administer analytics. Groom analytical users and leaders. Set and monitor SMART targets for analytical pursuits.

Know thy Limit

Mature analytical leaders blend analytics with intuition and never lose sight of the big business picture. They focus on the soft issues in business models and customer values and let their intuition take over as and when required.

Introspection for Decision Makers on use of Data Analytics.

Assessing where you are what are your analytical capabilities, strengths and weaknesses? Recognizing where to go next what strengths can you capitalize on, and what gaps should you try to close? Setting reasonable ambitions what can you hope to accomplish and when? Monitoring progress how fast and how far are you traveling on the journey to capitalize on analytics? Consensus with executive leadership and everyone else with an interest in succeeding with analytics how can each decision maker come to mutual understanding about capabilities and commitments to a plan of analytic action?

CA. Deepjee Singhal E-mail: dasinghal@yahoo.com

Conclusion
Traditional basis of competitive advantage CA. Manish Pipalia
Sources: 1. 2. 3. Analytics at Work Smarter Decisions Better Results Davenport, Harris and Morison Competing on Analytics The New Science of Winning Davenport and Harris Research papers on CAATs IDEA Data Analysis Software www.caseware-idea.com

The Corporate Value of Social Media

CA. Tribhuwan Singh
Tweeting, blogging and friending are common terms used in the world of social media, and they are becoming a part of business vocabulary as well. Still, these terms are barely the tip of the social media iceberg. Companies like Facebook, Twitter, LinkedIn and YouTube are helping to rewrite the rules for how companies are doing business in the 21st century. Social media is changing our working lives, giving employees and employers more flexibility and the ability to respond more quickly and, in some instances, in real time. Many companies are just now starting to take a serious look at the benefits of social media in business, and they are looking even more closely at the risks involved, such as fraud, theft, defamation, cyber-bullying and invasion of privacy among others. Success will ultimately come from applying social media activities to the right business objectives. Some of the more popular applications of social media are being used to address: Increasing revenue by creating a following of audience and listening and learning from the audience about their needs. Improving customer satisfaction and loyalty sharing by sharing both positive and negative feedbacks. Further, many bad or potentially bad experiences can be avoided or reversed when the organization is actively listening and engaging customers and sending positive messages for helping them. Empowering employees to build personal relationship and create a common place for prospective employees to directly engage with the brand in a manner in which all the participants felt comfortable. Product development and innovation takes on a whole new angle when combined with social media. It can take many forms such as a product innovation contest, and it is necessary that the process is completely transparent with the ideas submitted, encouraging conversation to occur around these ideas, including the status of each idea. Enhancing brand awareness and perception by allowing brand to be repositioned or reviewed. A 2009 Cone Consumer New Media Study showed 74 per cent of consumers had a more positive impression of an organization after interacting with it using social media, and 64 percent had a more favorable impression of a brand if a friend interacted with the organization using social media. is a commitment to monitoring and measuring. It is of utmost importance that the organization develops an organization wide policy for all employees relating to the use of social media. A social networking policy lays out, for all employees, the organizations guidelines, rules and regulations regarding employee conduct on social media. While many companies do have policies regarding e-mail communication and technology use, very few companies have policies that specifically address social media governance and risks. A company might not need a social media policy where another policy covers aspects of social media and that policy could be amended and updated instead of preparing a stand-alone social media policy. For example, many companies have an electronic communications policy to address appropriate uses of the companys computer system and to reduce employee expectations of privacy and a companys risk. Often, an electronic communications policy is amended to address the use of social media. Regardless of which approach is taken, a policy covering social media should be drafted to be consistent and integrated with other company policies (e.g., electronic communications policy, employee handbook, insider trading policy and disclosure policy) . If there is any inconsistency between the policy covering social media and another company policy, the one that will govern should be noted. There are a number of risks to be considered when using social media. The major risks include negative comments about the company, out-of-date information, disclosure of proprietary information, exposure of personally identifiable information (PII), and fraud. As social media continues to grow, so too will the need for adequate anti-fraud training. It is critical for management and employees to learn how to use social media appropriately, how to identify and respond to fraudulent activities, and how to address the legal issues surrounding social media.

At the heart of a successful social media program

CA. Tribhuwan singh E-mail: ca.tribhuwan@gmail.com 9

Enterprise Risk Management Create Stronger Governance and Compliance

CA. Rajnish Bansal
The business environment is increasingly throwing up newer challenges and opportunities with globalization, disruptive technologies and rules being continuously rewritten. New risks are, hence, coming up frequently. Enterprise Risk Management (ERM) system anticipates how an enterprise could be affected by a particular risk. Accordingly, ERM is all pervasive, cutting across management levels, functional/ departmental levels. response policy.

ISO 31000 and the ERM

International Standard on risk management called ISO 31000 identifies eleven principles of risk management as the foundation of framework and process

Definitions and Frameworks

The Committee of Sponsoring Organizations of the Treadway Commission (COSO) in its It involves 2004 ERM framework, defines ERM as Risk identification, prioritization and reporting, a process, effected by an entitys board of Risk mitigation, Risk monitoring, Risk assurance directors, management and other personnel, applied in strategy setting and across the Advantages of the ERM enterprise, designed to identify potential events that may affect the entity, and ERM serves as a strategic analysis of risk manage risk to be within its risk appetite, to throughout an organization, across all business provide reasonable assurance regarding the units and departments and also consider end-toachievement of entity objectives. end processes. Proper risk management systems The Australian and New Zealand Standard helps the management in identifying strategic on Risk Management (AS/NZS 4360:2004) risk opportunities that can help in achieving defines the risk management process as organizational goals., providing information the systematic application of management regarding risk that may be useful in decision-making policies, procedures and practices to the tasks process, achieving targets with risk identification of communicating, establishing the context, and management. Furthermore, the company by identifying, analysing, evaluating, treating, applying ERM can also accomplish many of their monitoring and reviewing risk ( governance-related tasks. The Institute of Internal Auditors (IIA) defines ERM as a structured, consistent The Board and ERM and continuous process across the whole organization for identifying, assessing, and Changing stakeholder expectations and expanding deciding on responses to and reporting on regulatory compliance responsibilities are prompting opportunities and threats that affect the an important shift in the role of Risk Managers. achievement of its objectives. The need for enhanced rigor and transparency The Insurance Rating Agency A.M. Best and a consolidated view of risk management has defines ERM as a process by which companies systematically identify, Integrated governance, risk and compliance(GRC) measure, and manage the various culture Governance types of risk inherent within their set and evaluate performance against establish an organizational climate and objectives mind-sets of individuals that promote operations. VERNANCE power to authorize a business strategy ethical behavior trust, integrity and GO and model to achieve objectives accountability Standard on Internal Audit (SIA) 13, Enterprise Risk Management issued by the ICAI, defines ERM as A CULTURE structured, consistent and continuous process of measuring or assessing risk Compliance Risk Management Proactively identify and rigorously Proactively encourage and require and developing strategies to manage assess and address potential obstacles compliance with established policies and to achieving objectives detect noncompliance and respond risk within risk appetite. It involves identify and address risks that the accordingly organization will step outside of identification, assessment, mitigation, mandated and voluntary boundaries planning and implementation of risk Source: Open Compliance and ethics group (OCEG) and developing an appropriate risk

Enterprise Process

Risk

Management

10

become paramount. Theses are the responsibilities of the Board to frame strategy, to implement it and establish suitable matrices to monitor it. Management is responsible for establishing policies and procedures; the assurance phase is accomplished by the internal auditor. Management is a part of ERM system both as a user of assurance and also as a provider of key inputs.

requirements and actualize the risk management system to meet companys need. These industries ranges form manufacturing to banking to asset management to any firm that is exposed to the vagaries of risk. Internal audit has an all-around role to play in the ERM arena. The role of the internal auditor is to provide assurance to management on the effectiveness of risk management. Internal auditor ascertains that risks are appropriately defined and managed. The internal auditor review that the risk management committee, enterprise business and unit heads and audit committee are reporting the results of the assessment of key risks at appropriate levels. Internal audits discipline, its knowledge of the organizations key risks, its enterprise- wide view, and its familiarity with the ERM framework enable it (unlike any other group) to bring an important perspective and discipline to an ERM effort.

Audit Committee and ERM

Audit Committees is increasingly being charged with the responsibility to assess the managements risk policies and discusses it with management. Accordingly, they are placing demands on management to provide more information about key risk areas and risk management processes. Audit Committee should be aware of procedures undertaken by the management to manage risks and should have the ability to assess how effectively the management is managing the risks. As a result, they are required to have sufficient knowledge and skill to understand the principles the ERM principles, framework and process in an integrated way so that they will be able exercise their role in overseeing risk management procedures, including the review and monitoring of key risk policies, risk authorities, and risk tolerances.

Role of Internal Auditor in ERM

There is a growing global demand for ERM professionals who can understand the business
The Board Overall responsibility for risk Management Ensure risk management is embedded into all processes and activists review group risk profile

CA. Rajnish Kumar Bansal E-mail: rajnish_ca2004@yahoo.com

Audit Committee Receive routine reports from GRMC Der annual audit programme and priorities Monitor progress with audit recommendations Provide risk assurance to the Board Oversee RM structures and processes

Group Risk Management Committee (GRMC) Formulate strategy and policy based on risk appatite risk attitudes and risk exposures Receive reports from business units, review risk management activities and compile the group risk register Receive reports from business units and make reports and recommendations to the Board Track RM activity in the business units and keep the risk management context under review Disclosures Committee review and evaluate disclosure contacts and procedures Consider materiality of information disclosed to external parties

Business units Produce specific policy statements as necesessary Prepare and update the business unit risk register sat risk priorities for business unit Monitor projects and risk improvements Prepare reports for GRMC Manage control risk self-certification activities

Direct and monitor Reports for evaluation

Source: The Institute of Risk Management

11

Whats New
1. Companies Hit with 14,215 Regulatory Announcements Globally in 2011 up 16%, says Thomson Reuters GRC Upto 60 Announecment Each Working Day, Total Set To Rise Agane In 2012 A copy of the report can be downloaded at: http://accelus.thomsonreuters.com/ content/special-report-state-regulatoryreform. FRC Publishes Paper on its Comply or Explain approach to Corporate Governance Refer link: http://www.frc.org.uk/Newsand-Events/FRC-Press/Press/2012/ February/FRC-publishes-paper-on-itscomply-or-explain-appro.aspx. COSO Publishes Risk Appetite Guide The COSO has released apaper aimed at helping organisations to articulate, develop and implement their appetite for risk more effectively. Refer link: http://www.coso.org/ documents/ERM-Understanding%20 %20Communicating%20Risk%20 Appetite-WEB_FINAL_r9.pdf. ICAIW: Audit Committee Challenges Should be Made Public Refer link: www.icaew.com/ fsfinspiringconfidence. IFAC Releases Policy Position Paper Four, Calling for Enhanced Public Sector Financial Management Transparency and Accountability Refer link: https://www.ifac.org/ publications-resources/public-sectorfinancial-management-transparencyand-accountability-use-intern. 12 6. IFAC Forum Addresses Challenges and Opportunities Facing SMPs in an EverChanging Global Marketplace Refer link: http://www.ifac.org/newsevents/2012-03/ifac-forum-addresseschallenges-and-opportunities-facingsmps-ever-changing-glob. ICAEW: Banks should Reveal Auditor Disagreements The report can be downloaded at bit.ly/ ymBX0S IFAC Releases Revisions to Policy Position Paper Two; Promoting a Single Set of Auditing Standards for All Audits, Including of Smalland Medium-Sized Entities Refer link: http://www.icaew.com/~/ m e d i a / F i l e s / Te c h n i c a l / F i n a n c i a l services/tecplm11129-webaudit-banks. ashx. IESBA Proposes Changes to Code of Ethics Definition of Engagement Team Refer link: http://www.ifac.org/sites/ default/files/publications/files/IESBACode-of-Ethics-Engagement-TeamED_0.pdf. COSO Releases Thought Paper on Enhancing Board Oversight by Avoiding and Challenging Traps and Biases in Professional Judgement Refer link: http://www. coso.org/documents/COSOEnhancingBoardOversight_r8_Webready%20(2).pdf. IAASB Staff Issues Q&A Document on Professional Skepticism Refer link: http://www.ifac.org/ sites/default/files/publications/ files/IAASB%20Professional%20 Skepticism%20QandA-final.pdf.

8.

2.

7.

3.

8.

4.

9.

5.

10.

11.

IMA: Research Identifies Biggest Challenges Facing Finance Organizations Refer link: http://www.ifac.org/ sites/default/files/publications/ files/IAASB%20Professional%20 Skepticism%20QandA-final.pdf. Corporate Reports still Hold Value Says ACCA Study Refer link: http://www.accaglobal. com/content/accaglobal/gb/en/ discover/news/2012/02/reassessingvalue/_jcr_content/relateddocuments/ parDocuments/download/file.res/valuereporting.pdf. COSO Releases Thought Paper on Enhancing Board Oversight by Avoiding and Challenging Traps and Biases in Professional Judgement Refer link: http://www. coso.org/documents/COSOEnhancingBoardOversight_r8_Webready%20(2).pdf. IAASB Strengthens Standard on Using the Work of Internal Auditors Using Internal Auditors to Provide Direct Assistance

Refer

link:

http://www.

coso.org/documents/COSOEnhancingBoardOversight_r8_Webready%20(2).pdf. 15. IFAC: Eleven Principles for Effective Business Reporting Processes Refer link: http://www.ifac.org/ sites/default/files/publications/files/ Exposure-Draft-Eleven-Principles-forImplementing-Effective-ReportingProcesses_0.pdf. 16. Good Practice Checklist for Small Business Published by IFAC http://www.ifac.org/sites/default/files/ publications/files/Exposure-DraftEleven-Principles-for-ImplementingEffective-Reporting-Processes_0.pdf. 17. Apb Publishes Paper on Professional Scepticism in The Audit Refer link: http://www.frc.org.uk/ images/uploaded/documents/APB%20 Briefing%20Paper%20Scepticism%20 March%202012%20Final3.pdf

12.

13.

14.

13

Fraud Control Legislation and Policies

The following list provides links to some of the standards and frameworks (some of which require a purchase) that explain the principles, concepts, benefits and processes related to Fraud Control: HM TreasuryManaging the Risk of Fraud- A Guide for Managers The purpose of this booklet is to show how the principles of sound risk management, governance and control apply to fraud and other irregular activities that might lead to fraud. HM Treasury Tackling This guide provides general guidelines for Internal Fraud managers and operational staff seeking to reduce the risk of fraud in an organisation. It provides guidance that can be applied to many aspects of government business HM Treasury, National The purpose of the guide is to demonstrate Audit Office (NAO) and explain some of the good practices and the Committee of used by organisations in tackling external Public Accounts Good fraud. It includes checklists to help you Practice Guide Tackling assess your current practices. External Fraud The IIA, AICPA, and This guide can be used to assess an ACFE organizations fraud risk management Managing the Risk of program, as a resource for improvement, or Fraud A Practical to develop a program where none exists. Guide Independent Commission Against Corruption (ICAC) Fighting Fraud Guidelines for State and Local Government The publication is structured to assist organisations to take a staged approach to preparing their fraud Responses. It has a section on prevention that is followed by one on detection. It then looks at some aspects of the investigation issues that can arise and finishes with discussion and guidance on managing situations in which fraud is discovered. This paper reviews best practice in dealing with fraud. http://www.hmtreasury.gov.uk/d/ managing_the_risk_ fraud_guide_for_ managers.pdf http://www.hmtreasury.gov.uk/d/ managing_the_risk_ fraud_guide_for_ managers.pdf.pdf http://www.hmtreasury.gov.uk/d/ tackling_external_fraud. pdf

http://www.acfe. com/uploadedFiles/ ACFE_Website/Content/ documents/managingbusiness-risk.pdf http://www.icac.nsw. gov.au/documents/ doc_download/1309fighting-fraudguidelines-for-state-andlocal-government

Responding To FraudAn ICAC Discussion Paper

Association of Certified Fraud Examiners (ACFE) - Report to the Nations on ccupational Fraud and Abuse

A comprehensive report that sheds light on occupational fraud and abuse while offering stark lessons and valuable insights about its prevention and detection.

http://www.icac.nsw. gov.au/documents/ doc_download/1319responding-to-fraud-anicac-discussion-paper http://www.acfe.com/ products.aspx?id=1612

14

The research highlights the factors that make the facilitation and management of public interest disclosures so challenging and complex. Findings are made that will help public sector managers improve existing processes, at an individual, organisational and jurisdictional level. These new guidelines are more principles-based, and establish the fraud control policy framework within which entities determine their own specific practices, plans and procedures to manage the prevention and detection of fraudulent activities. KPMG and the This survey provides a detailed University of Melbourne insight into contemporary fraud - Fraud and Misconduct issues in Australia and New Survey 2010 Zealand.

Australian National University Whistle Blowing in the Australian Public Sector : Enhancing the Theory and Practice of Internal Witness Management in Public Sector Organisations Australian National Audit Office (ANAO) and KPMG Better Practice Guide on Fraud Control in Australian Government Agencies

http://www.your-call.com. au/information/documents/ Whistleblowing-PublicSector.pdf

http://www.anao.gov.au/ html/Files/BPG%20HTML/ Government%20Fraud%20 Control%20BPG/foreword.html

Australian Standard- AS The objective of this Standard is to 8001-2008 Fraud and provide an outline for a suggested Corruption Control approach for controlling the risk of fraud and corruption within a wide range of entities across all industry sectors and government Public Trust Office This policy document is based on http://www.pt.qld.gov.au/files/ Fraud and Corruption the 10 element control framework fraud-policy.pdf Control Policy detailed in the Fraud and Corruption Control: Guidelines for Best Practice issued by the CMC in March 2005 The Audit Office of New South Wales - Better Practice Guide- Fraud Control improvement Kit Metting your fraud Obligations The Audit Office of New South Wales - Better Practice Guide-Fraud Control : Current Progress and Future Directions The kit assists organisations to meet their fraud control obligations in a cost-effective manner, tailored to their situation and based on risk. http://auditofficestaging. elcom.com.au/ ArticleDocuments/138/156_ Fraud_Control_Improvement. pdf.aspx?Embed=Y http://www.audit.nsw.gov.au/ Publications/Better-PracticeGuides

http://www.kpmg.com/ AU/en/IssuesAndInsights/ ArticlesPublications/FraudSurvey/Documents/Fraud-andMisconduct-Survey-2010.pdf http://infostore.saiglobal. com/store/Details. aspx?productid=996688

This Report provides updated guidance on improving arrangements for fraud control both at a whole-of-government level and at the agency level

15

New Batches of Certificate Courses Offered by the Internal Audit Standards Board Certificate Course on Concurrent Audit of Banks
Mumbai July 13 - 15, 20 - 22, 2012 Chennai August 24-26, 31 & September 1-2, 2012 Kolkata September 21 - 23, 28 - 30 2012 Bangalore October 5 - 7, 12 - 14 2012

The Internal Audit Standards Board of the ICAI is pleased to offer Certificate Course on Concurrent Audit of Banks to enable members to understand the intricacies of concurrent audit of banks. The overall objectives of the course are:

Course Duration
The total duration of the course is 6 days divided into twenty four modules.

Course Fees
The fees for the Course is ` 15,000 per delegates for metro cities and. ` 12,500 per delegates for nonmetro cities.

To supplement the effort of the banks in carrying out internal check of the transactions and other verifications and compliance with the procedures laid down; To improve the effectiveness of concurrent audit system in banks; To improve quality and coverage of concurrent audit reports.

CPE Hours
CPE credit of 36 structured hours will be given to the participants. Further Details and Registration Form Link http://www.icai.org/post.html?post_id=8236

Certificate Course on Enterprise Risk Management

Mumbai Chennai Kolkata August September October 4 & 5, 11 & 12, 18 15 & 16, 22 & 23, 29 13 & 14, 20 & 21, 27 & 19, 2012 & 30, 2012 & 28,2012

The Internal Audit Standards Board of the ICAI is pleased to offer Certificate Course on Enterprise Risk Management to enable members to develop competence in this emerging field and offer value added services. This course would help the members to understand the various issues relating to the enterprise risk management and in developing the necessary skills to provide value added services in this area. The Board has successfully completed the four batches of the Course organised at Delhi, Mumbai and Hyderabad respectively.

Course Objectives
The overall objectives of the course are: To enhance the role of Chartered Accountants in the area of ERM. To build ERM as one of their core competencies. The main thrust of the course is to educate the participants on: Theory and concepts of ERM. Manner in which ERM is designed and implemented in practice. Current thinking on risk management and its impact on contemporary business enterprises

16

Course Duration
The duration of the course is 200 hours spread over six class rooms studies, self studies, e-learning and Case Study preparation and presentation i.e., Self Study :100 hours Class room teaching : 50 hours E-Learning : 20 hours Case Study preparation and presentation : 30 hours

Course Fees CPE Hours

`. 25,000

CPE credit of 100 Hours (50 hours of structured learning and 50 hours of unstructured learning) will be given to the participants. Further Details and Registration Form Link http://www.icai.org/post.html?post_id=4287

Certificate Course on Internal Audit

Mumbai August 11 & 12, 18 &19, 25 & 26, 2012 and September 1&2, 8 & 9, 2012 Chennai Kolkata September 8 & 9, October 6 & 7, 13 & 15 & 16, 22 & 23, 14, 20 & 21, 27 & 28, 29 & 30, 2012 and 2012 and November October 6 & 7, 2012 3 & 4, 2012

Internal audit has, over the years, moved a long way forward to being a strong indispensable control tool in the hands of the management for effectively and efficiently running the affairs of the entity. Internal audit is playing a significant and critical role in evaluating the adequacy of internal controls and assessing the extent of compliance with the applicable laws and regulations, policies and procedures and suggesting ways to reduce the costs and promote efficiency. There is, therefore, a huge demand for professionally qualified persons in the area of Internal Audit. A professionally qualified chartered accountant, having regard to his training, education and exposure to the various facets of operations of an entity is well suited for internal audit. Keeping this in view, the Internal Audit Standards Board has decided to launch this Certificate Course on Internal Audit. The Board has successfully completed the first batch of the Course organised at Hyderabad.

3. 4.

business enterprises. Enhancing the role of chartered accountants in the area of Internal Audit and allied functions. Building up Internal Audit as a core competence area of chartered accountants.

Course Duration
The duration of the course is 200 hours spread over ten class rooms studies, self studies, e-learning and Case Study preparation and presentation i.e., Self Study : 100 hours Class room teaching : 60 hours E-Learning : 20 hours Case Study preparation and presentation : 20 hours This Certificate Course on Internal Audit, initiates the members to structural approach toward internal audit and manage intricacies of dynamic business environment.

Course Objectives
The Residential Certificate Course on Internal Audit has been designed to help the members: 1. 2. Disseminating knowledge on the theory and practice of Internal Audit and allied functions. Reflect current internal audit thinking and practices and how they impact contemporary

Eligibility
Only the Members of the Institute are eligible to pursue this Course.

Evaluation
Participants who successfully complete the course in line with the evaluation criteria mention below and qualifies the evaluation test will be awarded

17

Certificate. Eligibility: A candidate will have to attend a minimum of 42 hours of classes and complete the entire E-learning module, failing which, he/ she will not be entitled to appear in the evaluation. Weightage: the following weightage is assigned during evaluation: Class room learning and tests : 50 per cent E-learning : 20 per cent Case Study presentation : 20 per cent Class room attendance : 10 per cent Number of attempts: There is no limit on the permissible number of attempts for the evaluation tests. A candidate will be allowed to re-appear for the evaluation test only after six months of the previous attempt.

Course Fees ` 25000/CPE Hours

CPE credit of 100 Hours (50 hours of structured learning and 50 hours of unstructured learning) will be given to the participants. Further Details and Registration Form Link http://www.icai.org/post.html?post_id=7606 Course Registration is on First-Come-First Served basis on receipt of duly filled-in and signed application along with course fee.

Address for sending the Registration Form

Internal Audit Standards Board The Institute of Chartered Accountants of India ICAI Bhawan A-29, Sector 62, NOIDA 201 309

Further Details and Assistance

Chairman, Internal Audit Standards Board Tel.: 0120-3045949 Email: cia@icai.org; Secretary, Internal Audit Standards Board Tel.: 0120-3045949 Email: auditing@icai.org

18

New Publications of the Internal Audit Standards Board

Technical Guide Receivables Audit on Stock and
Contains an illustrative checklist in respect of stock and receivable audit and various specimen letters. Includes banking related glossary of terms and abbreviations. The guide comes with a CD of the entire guide to ensure ease of reference and reusability.

The auditor of the bank today, be it at branch level or the head office level, is faced with challenges of the growing complexities in the operating environment of banks, attributable not only to the transactional, customer, regional spread of the activities of the bank but also to frequent regulatory directions issued by the banking regulator coupled with increasing use of sophisticated technology. Considering this, the Internal Audit Standards Board of the ICAI is issuing Technical Guide on Stock and Receivables Audit to provide extensive knowledge to the members restricted not only to circulars issued by the Reserve Bank of India but extends to knowledge of the industry, regulatory and other external factors, including financial reporting framework, nature of the client, etc.,. This publication a comprehensive, self contained and touching upon almost all critical aspects in stock and receivable audit of banks. Significant Features of the Technical Guide are Covers concepts such as, inventories and receivable audit, valuation of inventories, verification of securities, etc. Explains objective, scope, purpose and need of Stock Audit. Provides knowledge about the following: Analytical Review Procedures. Planning of Physical Inventory. Stocktaking. Significant Observations in CashCredit Accounts. 19

Technical Guide on Internal Audit of Infrastructure Industry

Infrastructure Industry in India has been witnessing rapid growth in its different sectors due to growing urbanization and increasing rate of foreign investments in this field. The Indian government has taken various initiatives to develop the infrastructure sector. Effective internal audit provides a tool to ease out all the complexities, ensures that systems ad processes are adequate to support the growth and are adapted to the changes in various applicable regulations, thereby ensuring sustained growth and development. The Internal Audit Standards Board of the Institute has issued publication Technical Guide on Internal Audit of Infrastructure Industry. The Technical Guide gives guidance on the internal audit of the companies engaged in development of infrastructure facilities on Build operate and Transfer basis and has been divided into various chapters. Significant features of the Technical Guide are Brief overview on various aspects of the infrastructure industry in India, such as, receipt of material, storage, material movement, fixed assets, revenue and operating costs, etc.

Discusses major legislations governing the infrastructure industry. Deals with the overall approach of internal audit with reference to Standards on Internal Audit, and the procedures to be undertaken by the internal auditor with regard to peculiar aspects related to infrastructure industry. Provides guidance regarding the risks faced by the entity operating in the infrastructure industry Provides guidance regarding major areas of internal audit significance Operations and Management Material Handling and Storage Cash and Bank Revenue Recognition Includes glossary of terms peculiar to infrastructure industry. The Guide comes with a CD of the entire Guide to ensure ease of reference and reusability.

Significant features of the Technical Guide are Describes legal framework applicable to Not-For-Profit Organisations (NPOs): Indian Trusts Act, 1882 Societies Registration Act, 1860 Religious and Charitable Endowments Wakf The Sikh Gurudwara Act, 1925 Section 25 of the Companies Act, 1925 Non-trading Corporations Explain the taxation aspect and tax deduction for donors Detailed guidance regarding compliance of Foreign Compliance Regulation ACT (FCRA), 2010 Explains the key aspects related to the sector such as, revenue, expenses, fund accounting, in-kind contribution, etc. Describes the Standards on Internal Audit and Accounting Standards applicable to the Not-for-Profit Organisations. Deals with the overall approach of internal audit with reference to Standards on Internal Audit, and the procedures to be undertaken by the internal auditor with regard to peculiar aspects related to it. Provides an insight into major areas of internal audit significance: Receipts, Donations Grants Endowment Funds and Restricted Funds Contains an illustrative internal audit checklist regarding knowledge of business, budgeting, internal control, finance, donations and grants received, in-kind contribution, compliances FCRA 2010 The Guide comes with a CD of the entire Guide to ensure ease of reference and reusability.

Technical Guide on Internal Audit of Not-For-Profit Organisations (NPOs)

Financial accountability, transparency and good governance are the need of the hour in the NPO sector. This sector offers challenging and rewarding opportunities to Chartered Accountants in particular. They can play an important role in increasing the standards of resource mobilization, accountability and transparency in Not-for-Profit Sector. In view of the above, the Internal Audit Standards Board has issued this Technical Guide on Internal Audit of Not-For-Profit Organisations (NPOs) which comprehensively deals with the peculiar aspects of NPO sector, including various regulatory aspects and provides a step-wise approach for internal audit.

20

Technical Guide on Internal Audit of Mining and Extractive Industry

Mining sector is one of the largest and capital intensive sectors in the country. Globalization, competition of new mineral properties, and environmental regulations and concerns are some of the issues that introduce new layers of complexity for companies operating in mining sector. In view of the above, the Internal Audit Standards Board has issued this Technical Guide on Internal Audit of Mining and Extractive Industry. This comprehensive publication aims to help the members to understand entire spectrum of operational, conceptual and practical issues related to internal audit in mining sector. Significant features of the Technical Guide are: Overview of the history, evaluation, International scenario, industry overview, industry structure, challenges faced by the Mining Industry. Explains the technical aspects of the mining industry, such as:

Mine Planning and Mine Scheduling Mine Development Key activities in mining - mining operations, mineral processing, mineral beneficiation, mine closure, process monitoring, quality management process. Provides guidance on regulatory framework applicable to mining industry in detail. Explains need and objectives of internal audit of Mining industry. Describes the major focus areas of internal audit of mining industry, such as, mine evaluation and assessment, mine planning and scheduling, mine development, mining operations, mineral processing, process monitoring, statutory compliances and industrial relations, etc. Includes abbreviations used in the mining and extractive industry. The Guide comes with a CD of the entire Guide to ensure ease of reference and reusability.

21

Significant Achievements of the Internal Audit Standards Board (2011-12)

Technical / Generic Guides
During the period, the Board has brought out the following publications for the benefit of the members: i. ii. iii. iv. v. vi. vii. Technical Guide on Internal Audit of Retail Industry Technical Guide on Internal A udit of Life Insurance Business Compendium of Technical Guides on Internal Audit Handbook on Professional Opportunities in Internal Audit Technical Guide on Internal Audit of Mutual Fund Guide on Environmental Audit Technical Guide on Stock and Receivables Audit

Standards on Internal Audit

The Board has issued the Exposure Draft of the Standard on Internal Audit (SIA), Related Parties for public comments. The last day for comments is April 30, 2012. The Board has identified the following areas for developing Standards on Internal Audit (SIAs): i. Internal Auditors Response to Assessed Risks ii. Internal Audit Charter iii. Independence iv. Direct Interaction with Board v. Proficiency vi. Quality Assurance and Improvement Program vii. Policies and Procedures

Certificate Courses
Certificate Course on Enterprise Risk Management The Board has successfully completed the fourth batch of the Residential Certificate Course on Enterprise Risk Management which commenced in July, 2011 at Centre of Excellence, Hyderabad. Certificate Course on Internal Audit The Board has successfully completed the first batch of the Residential Certificate Course on Internal Audit which commenced in October, 2011 at Centre of Excellence, Hyderabad.

22

Others
1. The Board has issued first edition of its quarterly e-newsletter Internal Audit and Beyond with a view to provide valuable content on best practices and topical issues within the internal auditing profession. The Board is in the process of launching Certificate Course on Concurrent Audit of Banks for the members.

2.

CPE Programs
S. No. Topic 1. Seminar on Internal Audit, in association with SCOPE 2. 3. 4. 5. 6. 7. Two Days National Workshop on Internal Audit & Concurrent Audit Workshop on Green Audit Workshop on Internal Audit Seminar on Life Insurance Business ICAI Convention on Internal Audit Workshop on Changing Paradigm of Internal Audit in NPO and Co-operative Sector Three Days Workshop on Internal Audit (Jointly by Continuing Professional Education of ICAI and hosted by EIRC and Siliguri Branch of EIRC of ICAI) One Day Workshop on Internal Audit (hosted by Visakhapatnam Branch of SIRC of ICAI) Three Days Residential Workshop on Internal Audit of Treasury Function Seminar on Emerging Trends in Internal Audit (hosted by Vasai Branch of WIRC of ICAI) National Conference on Internal Audit (hosted by WIRC of ICAI) Date February 22, 2011 June 29-30, 2011 July 9, 2011 July 16, 2011 July 23, 2011 August 6 , 2011 August 19 and 20, 2011 November 12-14, 2011 Venue New Delhi Ernakulam New Delhi Jalandhar Mumbai Baroda Delhi

8.

Darjeeling

9.

November 25, 2011 November 25-27, 2011 December 18, 2011

Visakhapatnam

10. 11.

Centre of Excellence, Hyderabad Vasai

12.

December 23-24, 2011

Mumbai

23

Invitation To Participate In The Activities Of The Internal Audit Standards Board, ICAI (2012-13)
The Board Is Providing Opportunities To Participate Beyond The Membership Level.

Internal audit related activities have always been in prime focus for the Institute of Chartered Accountants of India which was formalised by constitution of a non- standing Committee, Committee on the Internal Audit on 5th February 2004. The prime objective of the Board is to reinforce the primacy of the Institute of Chartered Accountants of India as a promoter, source and purveyor of the knowledge of internal audit in the country. The basic idea was to enable the members of the Institute to provide more effective and efficient value added services related to the field of internal audit so as to enable the clients to systematise and strengthen their governance processby systematising and strengthening their control and risk management process. The objectives of the Internal Audit Standards Board (IASB) are as follows: to review the existing internal audit practices in India. to develop Standards on Internal Audit (SIAs) to be issued under the authority of the Council of the Institute. to develop Guidance Notes on the issues relating to internal audit, including those arising from the SIAs, to be issued under the authority of the Council of the Institute.

out high quality technical literature in the form of Standards on Internal Audit and Technical Guides/ Studies/ Manuals, which constitute an important tool in helping the internal auditors to provide effective and efficient internal audit services to the clients and/ or employers. The Internal Audit Standards Board has till date issued following 17 Standards on Internal Audit (SIAs) which are recommendatory in nature: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. Preface to the Standards on Internal Audit (2007 Edition) Framework for Standards on Internal Audit SIA 1, Planning an Internal Audit SIA 2, Basic Principles Governing Internal Audit SIA 3, Documentation SIA 4, Reporting SIA 5, Sampling SIA 6, Analytical Procedures SIA 7, Quality Assurance in Internal Audit SIA 8, Terms of Internal Audit Engagement SIA 9, Communication with Management SIA 10, Internal Audit Evidence SIA 11, Consideration of Fraud in an Internal Audit SIA 12, Internal Control Evaluation

The Board is working relentlessly to bring

24

15. 16. 17. 18. 19. 20.

SIA 13, Enterprise Risk Management SIA 14, Internal Audit in an Information Technology Environment SIA 15, Knowledge of the Entity and Its Environment SIA 16, Using the Work of an Expert SIA 17, Consideration of Laws and Regulations in an Internal Audit Compendium of Standards on Internal Audit (As on October 1, 2010)

15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32.

Apart from the Standards the Board has also issued the following publications till date: 1. 2. 3. Compendium of Technical Guide on Internal Audit (As on June 1, 2011) Technical Guide on Risk- based Internal Audit in Banks Technical Guide on Internal Audit in Oil & Gas Refining & Marketing Downstream) Enterprises Technical Guide on Internal Audit in Aluminium Industry Technical Guide on Internal Audit in Upstream Oil & Gas Companies Technical Guide on Internal Audit in Telecommunications Industry Technical Guide on Internal Audit of Stock Brokers Technical Guide on Internal Audit of Intangible Assets Technical Guide on Internal Audit of Treasury Function in Banks Technical Guide on Internal Audit of Educational Institutions Technical Guide on Internal Audit of Construction Industry Technical Guide on Internal Audit of Sugar Industry Technical Guide on Internal Audit of BPO Industry Technical Guide on Internal Audit of 25

Social Audit Technical Guide on Internal Audit of Retail Industry Technical Guide on Internal Audit of Life Insurance Business Technical Guide on Internal Audit of Stock and Receivables Audit Technical Guide on Internal Audit of Mutual Fund Technical Guide on Internal Audit of Infrastructure Industry Guide on Environmental Audit General Guidelines on Internal Audit Guide on Risk- based Internal Audit Guide to Internal Controls over Financial Reporting Guide to Implementing Enterprise Risk Management Manual on Concurrent Audit of Banks Manual on Internal Audit Study on Co-ordination of Internal Auditor with Functional Head Study on Investigative Audits Training Material on Internal Audit Handbook on Professional Opportunities in Internal Audit Background Material on Due Diligence What is an Internal Audit An informative and Concise Booklet

4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14.

Publications of the Board are available for free download at the following links: 1. Compendium of the Technical Guides on Internal Audit (Refer link: http://www. icai.org/post.html?post_id=7405) Compendium of the Standards on Internal Audit (Refer link: http://220.227.161.86/20964comp_ sia_1oct10.pdf) Technical Guide on Internal Audit of Life Insurance Companies (Refer link:

2.

3.

4.

5.

http://220.227.161.86/25373tg_lic_iasb. rar) Handbook on Professional Opportunities in Internal Audit (Refer link: http://220.22 7.161.86/25372hpoia_iasb.rar) Technical Guide on Internal Audit of Mutual Fund (Refer link: http://220.227.161.86/25374tg_mf_iasb. rar)

6.

7.

Technical Guide on Stock and Receivables Audit (Refer link: http://220.227.161.86/25948tgsra-iasb. rar) Guide on Environmental Audit (Refer link: http://220.227.161.86/25947gea-iasb. rar)

26

Areas for Contribution

Drafting of Standards on Internal Audit The Internal Audit Standards Board has till date issued 17 Standards on Internal Audit (SIAs) which are recommendatory in nature. In 2012-13, the Board may apart from popularizing the existing suite of Standards amongst the members as codication of best practices in the area of internal audit, may also take up issuance of Standards on Internal Audit in the following important areas: Preparation of Drafts of Technical Guides/ Studies Select from a list of area or submit your own topic to develop Research for the Internal Audit Standards Board. In addition to bringing out Standards, the Board also formulates industry specic guidelines as well as general guidelines on internal audit. The basic objective of these Technical Guides is to help the members as well as other readers in understanding the basic operations undertaken in the relevant industry. These Technical Guides also comprehensively cover detailed procedures to be undertaken by the internal auditor in respect of the specied areas The Board welcomes contribution in drafting of Technical Guides/ Guidelines/ Studies in emerging areas related to internal audit. Some topics on which projects may be developed are as follows: Industry Specic Guides i. i. ii. iii. iv. Generic Guides Auditing AntiMoney Laundering Compliance Auditing Sustainability KPIs Cloud Computing Audit and Risk Strategies Improving Internal Audit through Information Technology Study on Designing Internal Audit Charter Guide on Monitoring Internal Control Business Process Re-engineering and Internal Audit Guide on Internal Audit of Tendering Process Demonstrating value of internal audit to audit commi ees Auditing Shared Services Internal auditors role in o-balance sheet items Carbon trading, osets and renewable energy credits Issues pertaining to internal audit in the public sector Internal audit and Disaster Recovery Planning i. ii. iii. iv. v. vi. Revision of Existing Guides Manual on Concurrent Audit of Banks Manual on Internal Audit Training Material on Internal Audit Internal Control Questionnaire (v) Treasury Function in Banks (vi) Life Insurance Business

Abrasives and Grinding Wheels ii. Advertisement & Publicity iii. Agriculture and Agro Products iv. Air Conditioners v. Auto & Ancillary vi. Aviation vii. Bearing viii. Biotech Sector ix. Cables Power x. Cables Telephone Independence xi. Castings Independence Diredt Interaction xii. Caustic Soda Direct with the Board xiii. Cement Industry Interaction with the Proficiency xiv. Ceramics Tiles/ Sanitary Board Quality Assurance Ware Prociency and Improvement xv. Chemical Dyes and Quality Program Pigments Assurance and Policies and Procexvi. Chemical Organic/ Improvement dures Inorganic Program Risk Assessment and xvii. Chemicals Specialities Policies and Risk Response xviii. Cigare es Procedures xix. Compressors Risk Construction Housing/ Assessment and Risk xx. Commercial Response xxi. Decoratives/ Polywood xxii. Diamond Cu ing/ Jewellery xxiii. Distilleries/ Breweries xxiv. Dry Cells xxv. Electronic Consumer Goods xxvi. Engineering Turnkey Projects xxvii. Entertainment xxviii. Fast Moving Consumer Goods xxix. Fasteners xxx. Fertilizers xxxi. Food and Dairy Product xxxii. Food Processing xxxiii. Forgings xxxiv. Glass and Glass Products xxxv. Healthcare

v. vi. vii. viii. ix. x. xi. xii.

xiii. xiv.

27

i. ii. iii. iv. v. vi. vii. viii. ix. x. xi. xii. xiii. xiv. xv. xvi. xvii. xviii. xix. xx. xxi. xxii. xxiii. xxiv. xxv. xxvi. xxvii. xxviii. xxix. xxx. xxxi. xxxii. xxxiii.

Hotels/ Tourism Industrial Gases Investment Bankers IT So ware Development Leather/ Leather Footwear Moulded Luggage Municipalities and Local Bodies Natural Gas Transmission/ Distribution Newspaper Non-Banking Financial Companies Non-Pro t Organisations Packaging Paints/ Varnishes Paper Personal Care Pesticides/ Agrochem Petrochemical Pharmaceuticals Plastics Plastics Power Generation and Supply Power Hydro/ Renewable Power Transmission Printing / Publishing Pumps Refactories/ Intermediates Shipping Social Media Steel Industry Tea/ Co ee Textile Tyres Waste Management Company

Contributing Articles in Quarterly Resource person for Seminars/ Conferences/ Certi cate Courses E-newsletter Internal Audit and Webcasts Develop Modules or be a Beyond of the Board Participate as a guest speaker Faculty e Board welcomes contribution in authoring high quality articles on areas related to internal audit which can be published in the journal of the Institute and Quarterly E-newsletter Internal Audit and Beyond of the Board. (Refer Link: http://220.227.161.86/25834ia sb15409.pdf.) e Board also conducts In order to develop internal audit as one of the core competence area of the members and to update following Certi cate Courses: their skills in various contemporary issues related to internal audit, the Board organizes conferences, Certi cate Course on seminars, training programmes, workshops on Internal Audit internal audit in various parts of the country Certi cate Course which are hosted by the concerned Regional on Enterprise Risk Management Council/ Branch of the Institute. Certi cate Course on e Board plans to organize the following events Concurrent Audit of Banks during the year 2011-12:

28

Industry Speci c Seminar

How to audit. Series of Seminars for various functional areas

Dedicated Workshops on Improving Internal Audit rough Information Technology Topic: i. ii. iii. iv. v. vi. e Board invites application for the faculties of the abovementioned Certi cate Developing IT Audit Plan Course for taking up Technical Data Analysis Sessions of the Courses. e Technologies Board also appoints the Course Co- coordinator for each Auditing IT batch of the above-mentioned Projects Course for providing support Auditing to the Course. e Board also Application Controls invites application for Course Information coordinator also. Technology Outsourcing e Board also provides Modules to the participants Fraud of the Certi cate Course. Prevention Accordingly, the Board also and invites application of the Detection in an Automated experts who are interested in developing the modules of the World abovementioned Certi cate Managing and Auditing Courses. Privacy Risks

Topic: i. ii. iii. iv. v. vi. vii. Real estate and construction Power Not-forPro t organizations Retail Sector Insurance Sector Mutual Fund Financial Services

vii.

Honorarium
Honorarium for drafts approved for publication and reimbursement of incidental expenses will be made as per existing policy of the Institute in this regard. As per the Institutes policy, following are the rates of Honorarium:
Honorarium Basic draft of material Upto 50 pages 51 - 100 pages More than 100 pages Incidental expenses Rates (in `) 2,500 4,500 6,000

10,000 18,000 24,000

For Further Details, please feel free to contact:

Chairman, Internal Audit Standards Board and Internal Audit Standards Board Secretariat will provide full guidance and support to your initiatives.
CA. Rajkumar S. Adukia Chairman, Internal Audit Standards Board Tel : 09820061049 09323061049 Email: rajkumarfca@gmail.com CA. Rajendra Kumar P. Vice Chairman, Internal Audit Standards Board Tel : 0938230340 E-mail: council.rk@gmail.com Internal Audit Standards Board Secretariat Tel. : 0120-3045949 E-mail: cia@icai.org iasb.program@icai.in

29

Publications - Internal Audit Standards Board

Standards on Internal Audit (SIAs)
i. Standard on Internal Audit (SIA) 1, Planning an Internal Audit ii. Standard on Internal Audit (SIA) 2, Basic Principles Governing Internal Audit iii. Standard on Internal Audit (SIA) 3, Documentation iv. Standard on Internal Audit (SIA) 4, Reporting v. Standard on Internal Audit (SIA) 5, Sampling vi. Standard on Internal Audit (SIA) 6, Analytical Procedures vii. Standard on Internal Audit (SIA) 7, Quality Assurance in Internal Audit viii. Standard on Internal Audit (SIA) 8, Terms of Internal Audit Engagement ix. Standard on Internal Audit (SIA) 9, Communication with Management x. Standard on Internal Audit (SIA) 10, Internal Audit Evidence xi. Standard on Internal Audit (SIA) 11, Consideration of Fraud in an Internal Audit xii. Standard on Internal Audit (SIA) 12, Internal Control Evaluation xiii. Standard on Internal Audit (SIA) 13, Enterprise Risk Management xiv. Standard on Internal Audit (SIA) 14, Internal Audit in an Information Technology Environment xv. Standard on Internal Audit (SIA) 15, Knowledge of the Entity and its Environment xvi. Standard on Internal Audit (SIA) 16, Using the Work of an Expert xvii. Standard on Internal Audit (SIA) 17, Consideration of Laws and Regulations in an Internal Audit xviii. Compendium of Standards on Internal Audit (As October 1, 2010)

Technical Guides
i. Technical Guide on Risk- based Internal Audit in Banks ii. Technical Guide on Internal Audit in Oil & Gas Refining & Marketing (Downstream) Enterprises iii. Technical Guide on Internal Audit in Aluminium Industry iv. General Guidelines on Internal Audit v. Technical Guide on Internal Audit in Upstream Oil & Gas Companies vi. Guide on Risk- based Internal Audit vii. Guide to Internal Controls over Financial Reporting viii. Technical Guide on Internal Audit in Telecommunications Industry ix. Guide to Implementing Enterprise Risk Management x. Technical Guide on Internal Audit of Stock Brokers xi. Technical Guide on Internal Audit of Intangible Assets xii. Technical Guide on Internal Audit of Treasury Function in Banks xiii. Technical Guide on Internal Audit of Educational Institutions xiv. Technical Guide on Internal Audit of Construction Industry xv. Technical Guide on Internal Audit of Sugar Industry xvi. Technical Guide on Internal Audit of BPO Industry xvii. Technical Guide on Social Audit xviii. Technical Guide on Internal Audit of Retail Industry xix. Technical Guide on Internal Audit of Life Insurance Business xx. Compendium of Technical Guides on Internal Audit 30

xxi. xxii. xxiii. xxiv. xxv.

Technical Guide on Internal Audit of Mutual Fund Technical Guide on Stock and Receivables Audit Technical Guide on Internal Audit of Infrastructure Industry Technical Guide on Internal Audit of Not-for-profit Organisations (NPOs) Technical Guide on Internal Audit of Mining and Extractive Industry

viii. ix. x.

Informative and Concise Booklet Modules of the Certificate Course on Enterprise Risk Management Handbook on Professional Opportunities in Internal Audit Guide on Environmental Audit

Ordering Information
The publications are available at the sales counters of the Institute at New Delhi, Chennai, Mumbai, Kolkata and Kanpur. To order by post, please send a demand draft in favour of Secretary, The Institute of Chartered Accountants of India, payable at New Delhi to Postal Sales Department The Institute of Chartered Accountants of India ICAI Bhawan, A-29, Sector-62, NOIDA201 309 (UP).

Other Technical Literature

i. ii. iii. iv. v. vi. vii. Manual on Concurrent Audit of Banks Manual on Internal Audit Training Material on Internal Audit Background Material on Due Diligence Study on Co-ordination of Internal Auditor with Functional Heads Study on Investigative Audit What is an Internal Audit- An

31