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Internal Audit Department Orientation


Internal Audit Department Orientation Manu Patel, Internal Audit Director Purvi Mody, Executive Director, Compliance and Internal Audit, Health System – PowerPoint PPT presentation

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Title: Internal Audit Department Orientation

Internal Audit DepartmentOrientation
  • Manu Patel, Internal Audit Director
  • Purvi Mody, Executive Director, Compliance and
    Internal Audit, Health System
  • June 5, 2015

Audit and Compliance Committee(RPM 1.2, 7.3)
  • A standing committee of the Board of Regents
  • One member should be financial expert
  • Meets four or more times a year
  • Follows Open Meetings Act

Audit and Compliance Committee(RPM 7.3)
  • Oversight Responsibilities for Universitys
  • Financial reporting
  • Internal controls
  • Risk management
  • Performance of external financial and internal
  • Compliance with laws and regulations
  • Compliance program
  • Federal, state agencies audits and compliance

Authority of Internal Audit Dept. (IA) (RPM 7.2)
  • Was established to perform a comprehensive
    internal audit function
  • Has unrestricted access to all functions,
    records, property, and personnel
  • Obtains the necessary assistance of personnel
  • Communicates with personnel of internal,
    external, law enforcement agencies, etc.

  • IA reports functionally to the Audit and
    Compliance Committee
  • Free from interference in determining the scope
    of internal auditing
  • Empowered to obtain the information needed
  • IA reports administratively to the University

Independence (cont.)
  • Health System Internal Audit reports
    administratively to the Chief Executive Officer
    and Administrator of Hospital Operations

UNM Internal Audit Reporting Lines
  • Internal Audit

UNM Board of Regents
Audit Committee of Each Entity and COO of the
Health System (Steve McKernan)
HS Internal Audit (Purvi Mody)
UNM Internal Audit (Manu Patel)
UNM Main Campus
Health Sciences Center
Health System
School of Medicine, College of Nursing and
Research (Cancer Center and HSC)
Branch Campuses, Affiliated entities
(Foundation and Lobo Development, etc)
UNM Hospitals and 57 Clinics
UNM Cancer Center Clinics
UNM Medical Group and 7 clinics
  • UNM Internal Audit
  • Health System Internal Audit

Report Functionally to the Committee
  • The Committee reviews and approves UNM
    Internal Audits
  • Risk based internal audit plan
  • Budget and resource plan
  • Work product audit, consulting reports, etc.
  • Follow up report on managements responses to
    audit recommendations
  • Health System IA reports functionally to Board of
    Trustees Audit and Compliance Committee

Purpose and Scope of Work
  • Improve the University's operations
  • Determine whether the University's systems of
    controls, risk management, and governance, are
    adequate, and functioning properly to ensure
  • Risks are identified and managed
  • Employees' actions are compliant with policies
  • Resources are acquired economically, used
    efficiently, and adequately protected, etc.

Investigation of Fraudulent Activity
  • University policy requires Internal Audit to
    conduct investigations of fraud and employee
    misconduct if financial
  • Will coordinate investigations of suspected
    fraudulent activities within the University

Relevant UNM Policies
  • Policy 2200 Whistleblower Protection and
    Reporting Suspected Misconduct and Retaliation
  • Policy 7205 Dishonest or Fraudulent Activities

Definition of Internal Auditing
  • 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.
  • The Institute of Internal Auditors

Assurance Services
  • We provide an independent assessment on
    governance, risk management, and control
  • Examples of assurance engagements
  • management and performance
  • compliance
  • information technology
  • special requests
  • fraud

Types of Assurance Engagements
  • Special Request from senior management or the
    Board of Regents
  • may result from concerns about a program,
    function or account
  • Fraud examination
  • initiated from irregularities identified during
    routine audit work, management who find fraud in
    their organizations, and complaints from various
    sources including the Hotline

Risk Based Auditing
  • Focus on
  • risk of occurrences that could prevent the
    University from achieving its goals
  • areas with high risk where controls are not in
    place or are weak
  • Risk based audit plan
  • developed with input from across the University
  • based on available man hours
  • A university-wide 5-year plan is revisited

IA Process of Audit Report
  • Management responds to the report with 3 required
    elements within 10 days
  • Management obtains its EVPs approval
  • President approves managements responses
  • Committee reviews and approves
  • Report is made public except exempted information

Standards and Ethics
  • Adhere strictly to the Code of Ethics as
    established by the Institute of Internal Auditors
  • Abide by applicable standards made by IIA and the
    American Institute of Certified Public
    Accountants (AICPA)

  • IA must have a peer review at least once every
    five years
  • Last quality assessment was approved in March
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