I.   Foundations Of Internal Auditing

Interpret The IIA`s Mission of Internal Audit, Definition of Internal Auditing, and Core Principles for the Professional Practice of Internal Auditing, and the purpose, authority, and responsibility of the internal audit activity

​Explain the requirements of an internal audit charter (required components, board approval, communication of the charter, etc.)

Interpret the difference between assurance and consulting services provided by the internal audit activity

Demonstrate conformance with the IIA Code of Ethics

II.  Independence And Objectivity

Interpret organizational independence of the internal audit activity (importance of independence, functional reporting, etc.)

​Identify whether the internal audit activity has any impairments to its independence

Assess and maintain an individual internal auditor`s objectivity, including determining whether an individual internal auditor has any impairments to his/her objectivity

Analyze policies that promote objectivity

III. Proficiency And Due Professional Care

Recognize the knowledge, skills, and competencies required (whether developed or procured) to fulfill the responsibilities of the internal audit activity

Demonstrate the knowledge and competencies that an internal auditor needs to possess to perform his/her individual responsibilities, including technical skills and soft skills (communication skills, critical thinking, persuasion/negotiation and collaboration skills, etc.)

Demonstrate due professional care

Demonstrate an individual internal auditor`s competency through continuing professional development

IV. QUALITY ASSURANCE AND IMPROVEMENT PROGRAM

Describe the required elements of the quality assurance and improvement program (internal assessments, external assessments, etc.)

Describe the requirement of reporting the results of the quality assurance and improvement program to the board or other governing body

​​Identify appropriate disclosure of conformance vs. nonconformance with The IIA’s International Standards for the Professional Practice of Internal Auditing

V. Governance, Risk Management, And Control

Describe the concept of organizational governance

Recognize the impact of organizational culture on the overall control environment and individual engagement risks and controls

Recognize and interpret the organization`s ethics and compliance-related issues, alleged violations, and dispositions

​Describe corporate social responsibility

​Interpret fundamental concepts of risk and the risk management process

Describe globally accepted risk management frameworks appropriate to the organization (COSO - ERM, ISO 31000, etc.)

Examine the effectiveness of risk management within processes and functions

Recognize the appropriateness of the internal audit activity’s role in the organization`s risk management process

Interpret internal control concepts and types of controls

Apply globally accepted internal control frameworks appropriate to the organization (COSO, etc.)

Examine the effectiveness and efficiency of internal controls

VI. Fraud Risks

Interpret fraud risks and types of frauds and determine whether fraud risks require special consideration when conducting an engagement

Evaluate the potential for occurrence of fraud (red flags, etc.) and how the organization detects and manages fraud risks

Recommend controls to prevent and detect fraud and education to improve the organization`s fraud awareness

Recognize techniques and internal audit roles related to forensic auditing (interview, investigation, testing, etc.)

1. Internal Audit Operations

Describe policies and procedures for the planning, organizing, directing, and monitoring of internal audit operations

Interpret administrative activities (budgeting, resourcing, recruiting, staffing, etc.) of the internal audit activity

2. Establishing a Risk-based Internal Audit Plan

Identify sources of potential engagements (audit universe, audit cycle requirements, management requests, regulatory mandates, relevant market and industry trends, emerging issues, etc.)

Identify a risk management framework to assess risks and prioritize audit engagements based on the results of a risk assessment

Interpret the types of assurance engagements (risk and control assessments, audits of third parties and contract compliance, security and privacy, performance and quality audits, key performance indicators, operational audits, financial and regulatory compliance audits)

Interpret the types of consulting engagements (training, system design, system development, due diligence, privacy, benchmarking, internal control assessment, process mapping, etc.) designed to provide advice and insight

Describe coordination of internal audit efforts with the external auditor, regulatory oversight bodies, and other internal assurance functions, and potential reliance on other assurance providers

3. Communicating and Reporting to Senior Management and the Board

Recognize that the chief audit executive communicates the annual audit plan to senior management and the board and seeks the board`s approval

Identify significant risk exposures and control and governance issues for the chief audit executive to report to the board

Recognize that the chief audit executive reports on the overall effectiveness of the organization`s internal control and risk management processes to senior management and the board

Recognize internal audit key performance indicators that the chief audit executive communicates to senior management and the board periodically

1. Engagement Planning

Determine engagement objectives, evaluation criteria, and the scope of the engagement

Plan the engagement to assure identification of key risks and controls

Complete a detailed risk assessment of each audit area, including evaluating and prioritizing risk and control factors

Determine engagement procedures and prepare the engagement work program

Determine the level of staff and resources needed for the engagement

1. Information Gathering

Gather and examine relevant information (review previous audit reports and data, conduct walk-throughs and interviews, perform observations, etc.) as part of a preliminary survey of the engagement area

 Develop checklists and risk-and-control questionnaires as part of a preliminary survey of the engagement area

Apply appropriate sampling (nonstatistical, judgmental, discovery, etc.) and statistical analysis techniques

2. Analysis and Evaluation

Use computerized audit tools and techniques (data mining and extraction, continuous monitoring, automated workpapers, embedded audit modules, etc.)

Evaluate the relevance, sufficiency, and reliability of potential sources of evidence

Apply appropriate analytical approaches and process mapping techniques (process identification, workflow analysis, process map generation and analysis, spaghetti maps, RACI diagrams, etc.)

Determine and apply analytical review techniques (ratio estimation, variance analysis, budget vs. actual, trend analysis, other reasonableness tests, benchmarking, etc.)

Prepare workpapers and documentation of relevant information to support conclusions and engagement results

​Summarize and develop engagement conclusions, including assessment of risks and controls

Engagement Supervision

Identify key activities in supervising engagements (coordinate work assignments, review workpapers, evaluate auditors` performance, etc.)

Arrange preliminary communication with engagement clients

Demonstrate communication quality (accurate, objective, clear, concise, constructive, complete, and timely) and elements (objectives, scope, conclusions, recommendations, and action plan)

Prepare interim reporting on the engagement progress

Formulate recommendations to enhance and protect organizational value

Describe the audit engagement communication and reporting process, including holding the exit conference, developing the audit report (draft, review, approve, and distribute), and obtaining management`s response

Describe the chief audit executive`s responsibility for assessing residual risk

Describe the process for communicating risk acceptance (when management has accepted a level of risk that may be unacceptable to the organization)

Describe the audit engagement communication and reporting process, including holding the exit conference, developing the audit report (draft, review, approve, and distribute), and obtaining management`s response

Describe the chief audit executive`s responsibility for assessing residual risk

Describe the process for communicating risk acceptance (when management has accepted a level of risk that may be unacceptable to the organization)