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Introduction to specific internal audits
- 1. WHEN IS THE LAST TIME YOU DID SOMETHING FOR THE FIRST TIME
- 2. Welcome to the session • Module XVIII (2 p.m. to 5 p.m.) : Other Types of Internal Audits· • Due Diligence· • Environment Audit· • Social Audit· • Energy Audit· • Management Audit· • Sustainability Audit· • Human Resource Audit· • XBRL
- 4. DDR • Due Diligence • Beyond books • Beyond accounts • Outside office investigation • Department search • Auditor is a blood hound and not just a watchdog • Liaison between FDDR & LDDR • Tertiary DDR • Decision making not recommendatory • Future valuation- impact of DDR • What is materiality to do in this case? • Checklist • Model DDR report, CP, CS and Indemnity issues • Formats/ Check lists/ Proposals can be shared
- 6. Environment Audit & Energy audit • Inclusion of financial and non-financial data in a single report • Not a responsibility- a duty • Resources are scarce and are we using it wisely • Whether there are any alternatives? • Reporting is not mandatory • Doing something to stop global warming • Being a catalyst
- 7. Energy Audit
- 9. Social Audit • Used by government departments, private enterprises • If government is actually benefiting the people • Need: because there is a gap between what the people need, what the government thinks and what is actually done. • Assessing the physical and financial gaps between needs and resources available for local development. • Social audit is based on the principle that democratic local governance should be carried out, as far as possible, with the consent and understanding of all concerned. It is thus a process and not an event.
- 11. Management Audit • If management thoughts are reflected in operations • Vision monitoring • Link operations -> MIS-> Strategy-> Vision • Check the gap in 3 • Specific purpose audit • It is a Business audit not an assurance audit • Kurlon case • Personal experience in construction industry • Periodicity not defined • Need not be reported • Just for internal purposes
- 12. Sustainability audit • Planning • Market-> China-> Raw material-> alternatives-> BPO-> Cassette (piracy) • Environment-> Agra industries-> Iron ore in Karnataka->Banian factory in Tirupur • Law-> plastic bottle ->KFC-> barrack obama • Succession plans-> will-> family arrangement • Technology-> Kodak v/snokia-> Ambassador->Dhingana.com • Culture-> Fashion • • Infosys (salient features) • Growth is linked to ecosystem- employees and business partners, local communities and the environment. • Three areas: 1. Social contract, Resource efficiency, Green innovation
- 13. HR Audit • Compliances • Hr policies linked with sustainability • Documentation • Impact of PMS on retention • ESOP audit’ • Payroll audit • HR accounting and capture of data • Time management and Time sheet • HR with vision of the company-> quantity v/s Quality
- 14. XBRL Audit • From statistical testing to 100% testing • Creating conditions for the transition to a continuous auditing model • Combining data from multiple systems • Presenting any kind of report at ease • Eliminate or reduce manual intervention • Reduced risk • Electronically available information • develop standardized, shareable and electronically executable internal audit programs
- 15. The speaker acknowledges the cartoons by Dilbert.com • Thank you