INTERNAL AND EXTERNAL AUDITING IN

PRIVATE SCHOOL

Reporter:JONNA MAY M. BERCI

INTERNAL AUDIT - an independent, objective assurance and consulting activity designed to add value and improve an organization's operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control and governance processes.

INTERNAL AUDITORS

- Integral to the organization and provide on going monitoring and assessment of all activities

- Their objectives are determined by professional standards, the board and management

- It serves the organization by helping it accomplish its objectives, and improving operations, risk management, internal controls, and governance processes.

- Concerned with all aspects of the organization, both financial and non-financial.

- Focus on future events as a result of their continuous review and evaluation of controls and processes.

- Concerned with the prevention of fraud in any form.

ROLES AND RESPONSIBILITI

ES OF INTERNAL AUDIT

FUNCTION

- Evaluates and provides reasonable assurance that risk management, control, and governance systems are functioning as intended and will enable the organization’s objectives and goals to be met

- Reports risk management issues and internal controls deficiencies identified directly to the audit committee and provides recommendations for improving the organization’s operations, in terms of both efficient and effective performance

- Evaluates information security and associated risk exposures

- Evaluates regulatory compliance program with consultation from legal counsel

- Evaluates the organization’s readiness in case of business interruption

- Maintains open communication with management and the audit committee

- Teams with other internal and external resources as appropriate

- Engages in continuous education and staff development

- Provides support to the company's anti-fraud programs.

- Provides an independent appraisal function within a school district that evaluates the efficiency and effectiveness of the district's operations as well as compliance with laws, rules, regulations, policies and procedures.

- Reviews activities for efficient and effective operations.

- Makes recommendations to enhance operations and processes.

EXTERNAL AUDIT - Periodic or specific

purpose audit conducted by external independent qualified accountant.

- It is designed to provide reasonable assurance that the financial statements fairly present the financial condition.

- Reviews internal controls for material weaknesses and checks for compliance with laws, rules and regulations.

OBJECTIVES OF

EXTERNAL AUDITING

- Determine the accounting records are accurate and complete.

- Prepared in accordance with the provisions of statements.

- Prepared from the accounts present fairly the organization's financial position, and the results of its financial operations.

EXTERNAL AUDITORS

- Independent of the organization and provide an annual opinion on the financial statements

- Their objectives are set primarily by statute.

- Provide an independent opinion on the organization's financial statements, annually.

- Their approach is historical in nature

IMPORTANCE OF AN

EXTERNAL AUDIT

1.) Ensures compliance

2.) Provides credibility.

3.) Critique internal processes

4.) Double check internal audit

THANK YOU!