Module 4 - Introduction to Performance Audit_4A

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Supervision 66) The SAI shall ensure that the work of the audit staff at each level and audit phase is properly supervised during the audit process. 67) Audit supervision involves providing sufficient guidance and direction to the audit team assigned to the audit. The auditor who supervises the audit would be expected to have competence and knowledge in audit methodologies; planning and monitoring work; project management; strategic thinking; foresight and problem solving. The level of supervision provided by the auditor may vary depending upon the proficiency and experience of the audit team and the complexity of the subject matter of the audit. 32 It should be noted that a team member designated to supervise an engagement should not have responsibilities for that engagement to avoid a conflict of interest. This presents practical difficulties in small audit teams. There are two aspects to supervision: Overseeing individuals. Overseeing their work. The supervisor assigns tasks, confirms expectations, monitors performance, provides feedback and encouragement, intervenes where necessary, directs, advises, and coaches, offers on-the-job training, and acknowledges and celebrates achievements. Supervisors also provide feedback to higher levels of authority, up to the head of internal audit or the SAI. The engagement plan provides a suitable framework within which the supervisor guides and supports auditors. The supervisory work may begin with assisting with the development of the plan which thereafter informs not only the performance of the audit but also the discharge of supervision. The engagement plan will typically identify the key tasks to be completed, including the following: Guiding the survey phase to obtain knowledge to formulate objectives. Formulating clear audit objectives that set forth what the audit is expected to accomplish. Coordinating with other auditors when appropriate, including work that is planned or already completed. Selecting a valid and sound scope and methodology for accomplishing the objectives and obtaining sufficient data without wasting resources in acquiring unneeded data. Establishing the type and amount of resources and staff skills and knowledge, and the use of any consultants and experts. Segmenting the work where necessary to clearly identify responsibility of assigned staff. Identifying audit criteria, when criteria is to be applied in the audit. Selecting a strategy and approach for communicating audit results to users timely and effectively. 32 ISSAI 3000 Performance Audit Standard, INTOSAI, 2019. 20
Choosing quality assurance steps that will ensure adherence with applicable auditing standards, including those for evidence to support audit findings. 33 The supervisor also has an important role in determining the staff resources needed for the engagement to ensure the right capacity and quality of skills and expertise are available. The number, frequency, and nature of review meetings held by the supervisor with the auditor or auditors should be decided based on need. Factors would include the level of experience of the auditor, the length and complexity of the audit, and personal preferences of both parties. Meetings should be structured by focusing on the audit plan, have a clear purpose, and result in agreed actions that are recorded and shared. Other Aspects of Quality Control Quality is essential for the integrity of the audit provider. As referenced above, the role of supervision plays a key role in quality assurance and is described by the IPPF as part of a comprehensive quality assurance and improvement program (QAIP). Audit policies and procedures should be designed to promote quality, conformance with the Standards, and continuous improvement. Regular internal and external review of the QAIP is needed to ensure it is working. The head of the internal audit function is required to keep the governing body advised on matters relating to QAIP and conformance. ISSAI 140 Quality Control for SAIs identifies six elements required for quality assurance and control, as summarized in the graphic below. Acceptance and continuance Human resources Ethical requirements Performance Leadership responsibilities Framework of Quality Control Monitoring These principles are defined as follows: Six Elements of SAI’s System of Quality Control 34 Leadership responsibilities: An SAI should establish policies and procedures designed to promote an internal culture recognising that quality is essential in 33 Rauum and Morgan, Performance Auditing: A Measurement Approach, the Internal Audit Research Foundation, 2009. 34 As defined in ISSAI 140 Quality Control for SAIs, INTOSAI, 2019. 21
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Module 4 - Introduction to Performance Audit_4A

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