Best Practices Bank Internal Audit (Sep. 13, 2003)
Course Objective:
Expose participants to best practices in Bank Internal Audit in order to provide them with tips and hints so they don't have to "re-invent the wheel."
Participants:
Internal auditors, external auditors, risk managers, compliance officers, information technology security officers, management, educators and any performer in bank auditing.
09.00
Introduction
09.15
Internal Audit in Banks
- The current banking environment: issues, pressures, concerns
- International, regional and local events and developments
- External and internal drivers and influences on internal audit
- The role and work of the Bank for International Settlements and the Basel Committee on Banking Supervision
- BIS and other guidance on governance, risk management and control
- Basel 2 and the impact of this and other developments on internal audit
- Role, responsibilities and ojectives of bank internal audit
- Authority and reporting lines; essential conditions
- The scope of work
- "Types" of audits and audit activities
- Approaches; developments such as CSA
- Moving from inspection to providing a risk-focused service to the board
- What a "typical" bank internal audit unit does: current issues and concerns
10.30
Coffee Break
10.45
Worst Practices in Bank Internal Audit
- High profile control and audit failures, e.g. Allfirst, Barings
- Lessons to be learned
Exercise: How to audit branches -- the seven options
11.45
The Basel Committee on Banking Supervision
- The BCBS guidance on bank internal audit: contents, interpretation, application
- The 20 Basel principles
- Internal audit and operational risk
Discussion groups: underestimating and applying the Basel Principles
13.00
Lunch Break
14.00
Defining Internal Audit's Work
- Central Bank Circular #77 on Internal Audit (old #1837)
- Basel/IIA definition
- Objectives and tasks of the internal audit function
- Responsibilities of board, management and others
Risk-Based Auditing in Banks
- Expectations; rationale behind a risk-based approach
- Principles and practices: the three aspects of risk-based auditing
- Banking risks
- Risk-based auditing methodology and techniques
- Compiling a risk-based audit plan
Exercise in strategic risk assessment and audit planning
15.15
Coffee Break
15.30
Performing Audits of Strategic and Operational Bank Activities
- Planning an audit assessment
- Examples of high level, corporate bank audits
- Across-the-board audits, e.g. money laundering, customer satisfaction
- Using control frameworks such as COSO; relevant BCBS guidance
- Examples of operational level audits
Worked examples and exercise (e.g. the audit of ATMs, credit risk management)