Internal Audit

Internal Audit Charter

Mission

The mission of the Office of Internal Audit is to provide independent, objective assurance and consulting services designed to add value to, protect, and strengthen the management of the University of Wisconsin System and its colleges, universities, and extension.

Purpose

The purpose of the Office of Internal Audit is to determine whether the University of Wisconsin System’s risk management, control, and governance processes, as designed and implemented by management, are adequate and functioning in a manner to ensure:

  • Risks are appropriately identified and managed.
  • Interaction with various governance groups occurs as needed.
  • Financial, managerial, and operating information is accurate, reliable, and timely.
  • Employee actions are in compliance with University policies and procedures, and applicable laws and regulations.
  • Resources are acquired economically, used efficiently, and adequately protected.
  • Programs, plans, and objectives are achieved.
  • Quality and continuous improvement are incorporated in the University of Wisconsin System’s control process.
  • Significant legislative or regulatory issues impacting the University of Wisconsin System are recognized and addressed appropriately.

Responsibilities

The Office of Internal Audit will:

  • Develop a flexible annual audit plan using an appropriate risk-based methodology, including any risks or control concerns identified by management, and submit the plan to the Audit Committee of the Board of Regents.
  • Implement the audit plan, as approved by the Audit Committee of the Board of Regents, including as appropriate any special tasks or projects requested by management and the Board of Regents.
  • Maintain a professional audit staff with sufficient knowledge, skills, experience, and professional certifications to meet the requirements of this Charter.
  • Evaluate and assess significant new or changing services, processes, operations, and control processes coincident with their development, implementation, and/or expansion.
  • Review the status of Board of Regents policy implementation.
  • Review the effectiveness with which University of Wisconsin institutions or the University of Wisconsin System Administration has implemented state or federal requirements.
  • Conduct research and analysis in operational areas of interest to the Board of Regents or University of Wisconsin institutions.
  • Issue periodic reports to the Audit Committee of the Board of Regents summarizing the results of audit activities.
  • Provide to management and the Audit Committee of the Board of Regents information related to emerging trends and successful practices in internal auditing.
  • Assist University of Wisconsin System management by conducting targeted studies to assist management in meeting its objectives, the nature of which is agreed to with management, and for which the Office of Internal Audit assumes no management responsibility.
  • Assist in the investigation of suspected fraudulent activities within the University of Wisconsin System and notify the management and Audit Committee of the Board of Regents of the results, as appropriate.
  • Request from individuals responsible for the subject matter of reports of the Office of Internal Audit a response to specific findings and recommendations, including a timetable for anticipated completion of corrective action(s) to be taken or an explanation for any corrective action(s) that will not be implemented.
  • Establish a follow-up process to monitor and identify whether corrective actions have been effectively implemented, or whether senior management has accepted the risk of not taking action.
  • Consider the scope of work of the external auditors and regulators as appropriate for the purpose of providing optimal audit coverage to the institution.
  • Review and update the Internal Audit Charter, as necessary, and periodically provide to the Audit Committee of the Board of Regents for review and approval.
  • Coordinate training opportunities for and provide assistance to Institutional Auditors within the University of Wisconsin System, as appropriate.
  • Review audit plans and copies of reports prepared by Institutional Auditors within the University of Wisconsin System, as appropriate.

Authority

The Office of Internal Audit is authorized to:
  • Have unrestricted access to all functions, records, property, and personnel relevant to engagements.
  • Audit the accounts of all organizations required to submit financial statements to the University of Wisconsin System.
  • Allocate resources, set frequencies, select subjects, determine scopes of work, and apply the techniques required to accomplish audit objectives.
  • Obtain the necessary assistance of personnel in areas of the University of Wisconsin System where audits are being performed, as well as other specialized services from within the University of Wisconsin System.
  • Maintain the independence necessary to render objective reports by assuring all audit activities (including audit scope, procedures, frequency, timing, and report content) are free from influence by auditee.
  • Have full and unencumbered access to the President of the University of Wisconsin System and Audit Committee of the Board of Regents.

The Office of Internal Audit is not authorized to:

  • Perform any operational duties for the University of Wisconsin System, its campuses, or its affiliates.  Internal auditors will have no direct operational responsibility or authority over any of the activities audited.  Accordingly, internal auditors will not implement internal controls, develop procedures, install systems, prepare records, or engage in any other activity that may impair internal auditor’s independence of judgment.
  • Initiate or approve accounting transactions external to the Office of Internal Audit.
  • Develop or install systems or procedures, prepare records, make management decisions, or engage in any other activity that could be reasonably construed to compromise the Office of Internal Audit’s independence or impair its objectivity.
  • Direct the activities of any organization employee not employed by the Office of Internal Audit, except to the extent such employees have been appropriately assigned to auditing teams or to otherwise assist the internal auditors.

Internal audit reviews do not, in any way, substitute for or relieve other University of Wisconsin System personnel from their assigned responsibilities.

Organization

The Office of Internal Audit will be led by a Chief Audit Executive, who reports to the Board of Regents through the Audit Committee directly and to the UW System President.

Standards of Audit Practice

The Office of Internal Audit will exercise professional objectivity in gathering, evaluating, and communicating information about the activity or process subject to audit.  Furthermore, the staff of the Office of Internal Audit will strive to make a balanced assessment of all the relevant circumstances and not be unduly influenced by personal interests or by others in forming judgments.

The Office of Internal Audit will carry out its responsibilities in accordance with University of Wisconsin System policies, state law, and federal law.  Additionally, the Office of Internal Audit recognizes the mandatory nature of the Definition of Internal Auditing, the Code of Ethics, and the International Standards for the Professional Practice of Internal Auditing, which are part of the International Professional Practice Framework (IPPF), which is the conceptual framework that organizes authoritative guidance promulgated by the Institute of Internal Auditors.  All policies and procedures implemented by the Office of Internal Audit will adhere to the IPPF.

Approval

The Internal Audit Charter was approved by the Board of Regents on October 7, 2011.