Internal auditing
Internal auditing is a process which provides assurance and consulting service like evaluate the controls, performance efficiency, detect the risk management and governance to a public and private entity in order to adding value to the organization.
Internal auditor
For every public listed company in Malaysia is required to build up an internal audit department request by security stock exchange. Internal auditor is a profession provides independence and objectivity appraisal and attesting on the organization financial and non-financial information, organization activities performance, reviewing adequacy of accounting controls, provide information for the manager or management level to make decision, aware on the any wasteful and fraud existing in an organization and they should reviews activity continually.
Institute of Internal Auditors
History
Institute of internal auditors (IIA) establish at the year 1977 in Malaysia, as a non-profit professional organization focus on the developing of internal auditor profession practice in Malaysia.
At year 1977, IIA Malaysia is branch from the institute of internal auditors Inc, USA. Until year 1994, IIA Malaysia incorporate as a company limited by guarantee and keep going improve and upgrade standard to match with current public needed and member of the institute of internal auditors Malaysia enlarge to 3000 members around the nation.
Vision
Institute of internal auditors Malaysia delegate as national voice of the internal auditor. IIA Malaysia protect the value to the member, provide necessary and best practice to members and also provide service to the member to overcome the problems.
Mission
IIA Malaysia furnish exceptional leadership to lead nation pr...
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... and impact of non-conformance and the communicated engagement results
2440 Disseminating Results
To ensure information related to audits, site visits, and other external evaluations are communicated to all relevant and appropriate parties.
2500 Monitoring Progress
A self-assessment by line management is likely to be the most efficient and effective approach to monitor progress. A follow-up audit may be appropriate, with the scope and timing of any follow-up audit being determined by the risks posed to the entity if the recommendations are not implemented in an effective and timely manner.
2600 Resolution of Management’s Acceptance of Risks
To follow up of audit issues is an integral part of good management. The responsibilities of chief audit executive and senior management have duties for the assessment and resolution of financial audit issues and report.
The purpose of the internal audit is to protect Costco 's assets through evaluating the acceptability and efficiency of internal controls; recognizing areas of possible risk, revenue improvement and/or cost reductions; and making sure transactions are authorized, completed, and logged as proposed. The internal auditors are accountable for guiding audits of all Costco’s local and global activities, its affiliates, and other entities Costco conducts business with as deemed necessary by management.
“Fifth, the company should audit the whole process frequently to ensure compli- ance with these procedures.”
The Institute of Internal Auditors. "Internal Auditing's Role In Section 302 and 404 of the U.S Sarbanes-Oxley Act of 2002." The Institute of Internal Auditors (2004): 1-13.
The effectiveness of tax auditing means that the tax auditors had performed an effective work without any impact on the tax payers. There are five factors that considered as the determinants for the effectiveness of tax auditing, which are audit quality, management support, organizational setting, attributes of the audited party and organizational independence. The tax audit effectiveness also refer to the ability and capability of a tax audit to provide useful findings of auditing and recommendations which would attracted the management’s interest. The management that support with resources and implement the recommendations of tax audit is essential for reaching the tax audit effectiveness. Besides, the organizational setting in operations
Objectivity also needs to be evaluated to make sure the internal audit is reliable. The internal audit needs to be free of conflicting responsibilities as well
According to the article authored by Mark Rupert, what are the seven best practices in the roles and responsibilities of an internal audit function?
Particular attention is focused on evaluation and management codes to ensure their correct use. Internal audits should be performed as part of the office routine and not just when suspicious or fraudulent behavior is detected. This is the best way to reduce the chance for an investigation and to prevent employees from having to become whistleblowers. Internal audits are necessary to determine if procedures are being coded accurately based on the documentation. They also help evaluate a coders knowledge and skill and provide feedback to the practice as to the need for training or review of the compliance plan and policies.
Integrity in the accounting profession involves adhering to the rules and principles of the profession. This includes remaining free of conflicts of interest and maintaining client relationships in which the accountant can remain objective in discharging his or her responsibilities. This requires independence in fact and in appearance as mandated under section 1.200.001.01, Independence Rule the AICPA Code. In other words, no one should be able to view the accountant as being biased with respect to a client’s financial reporting due to an improper client relationship. Lack of integrity in accounting practices has been, and continues to be, a key element in the downfall of many institutions which has hurt the public trust in the accounting
Having the ISA ensures that all auditors have an awareness of the responsibilities, creating an equality for all entities. It is important to differentiate between fraud and error during an audit, as unfair blame can permanently tarnish an entity’s reputation, reducing shareholder confidence.
Securities Commission Malaysia. (2014). General Section: Audit Oversight Board. Retrieved March 26, 2014, from Securities Commission Malaysia: http://www.sc.com.my/general_section/audit-oversight-board/
The international professional activities of the accountancy bodies were organized under the International Federation of Accountants (IFAC) in 1977. In 1981, IASC and IFAC agreed that IASC would have full and complete autonomy in setting international accounting standards and in publishing discussion documents on international accounting issues. At the same time, all members of IFAC became members of IASC. This membership link was discontinued in May 2000 when IASC's Constitution was changed as part of the reorganization of IASC.
...e financial reports and statements are correct. This auditing will be conducted by auditing department of the organization, even may be done by an independent auditor who is not part of the organization, and sometimes public officials are elected. In case of unmatched consequences the organization need to give explanation on the misrepresentation of wrong statements. Auditors purpose is then to ensure that the misrepresentations are corrected, then maintain accurate, reliable financial documents and statements.
Overall, the company is having ineffective controls regarding different departments and in the whole organization. An effective internal audit department should be established within the organization which should test the effectiveness of these controls on regular basis and make it sure that all controls are working effectively and efficiently with the different departments of the organization. Also the Internal auditor should implement the most effective processes and measures to prevent and detect the fraud, corruption and non compliance with the laws and regulations in the organization. Establishment of internal audit committee would be helpful in this regard which comprises of executive and non executive directors.
Audit is a process to evaluate and review the accounts and financial statement objectively. We can divide it into internal auditors and external auditors. Internal auditors have a inner knowledge of business process. Auditor has access to the much confidential information and all levels of management. But they may lose their judgement and they are not acceptable by the shareholder. “The overall objective of the external auditors is to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to report on the financial statements in acco...
The third organization that helps to regulate the accounting standards is the IASB. “Our mission is to develop, in the public interest, a single set of high quality, understandable and international financial reporting standards (IFRSs) for general purpose financial statements”(IASB 2008,¶ 1). The IASB consists of a board that is made up from nine different countries with the sole purpose of expanding accounting standards. Their main hope and goal is to one day that there will be only one set of accounting standards that will be used throughout the world.