North Carolina A & T State University
Office of Internal Auditing
Internal Audit Charter
Effective: March 1, 2010
The Office of Internal Auditing provides independent, objective assurance and consulting services designed to add value and improve the University’s operations. The Office of Internal Auditing helps the University accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, internal control, and governance processes.
Scope of Work
The scope of work of the Office of Internal Auditing is to determine whether the University’s network of risk management, internal control, and governance processes, as designed by management, is adequate and functioning in a manner to ensure:
- Risks are appropriately identified and managed.
- Significant financial, managerial, and operating information is accurate, reliable, and timely.
- Employees’ actions are in compliance with policies, standards, procedures, and applicable laws and regulations.
- Resources are acquired economically, used efficiently, and adequately protected.
- Programs, plans, and objectives are achieved.
- Quality and continuous improvements are fostered in the University’s control process.
- Significant legislative or regulatory issues impacting the University are recognized and addressed appropriately.
- Accountability, integrity and efficiency within the University.
- Interaction with the various governance groups occurs as needed.
Opportunities for improving management control and the organization’s image may be identified during audits and reviews. They will be communicated to the appropriate level of management.
The Director of Internal Auditing, in the discharge of his/her duties, shall be accountable to the North Carolina A & T State University Board of Trustees’ Audit Committee and to the Chancellor to:
- Provide an assessment on the adequacy and effectiveness of the University’s processes for controlling its activities and managing its risk in the areas set forth under the mission and scope of work.
- Report significant issues related to the processes for managing risk and controlling the activities of the University and its affiliates, including potential improvements to those processes, and provide information concerning such issues through resolution.
- Provide information periodically on the status and results of the annual audit plan and the sufficiency of the internal audit department resources.
- Coordinate internal activities with other monitoring functions such as risk management, compliance, security, legal, ethics, environmental, and external audits.
- Maintain a follow-up process to track actions related to important issues and recommendations.
- Maintain audit records in accordance with the State’s records retention schedule.
The internal audit activity should be free from interference in determining the scope of internal auditing, performing work, and communicating results. To provide for the independence of the Office of Internal Auditing, its personnel report to the Director of Internal Auditing, who reports administratively to the Chancellor and functionally to the Audit Committee. The Director shall have full and independent access to the Chancellor and the Audit Committee.
The Director and staff of the Office of Internal Auditing have responsibility to:
- Develop a flexible annual audit plan using an appropriate risk-based methodology, including any risks or control concerns identified by management, and submit that plan to the Chancellor and Audit Committee for review and approval as well as periodic updates.
- Implement the annual audit plan, as approved, including as appropriate any special tasks or projects requested by management and the Audit Committee.
- Maintain a professional audit staff with sufficient knowledge, skills, experience, and professional certifications to meet the requirements of the Charter.
- Establish a quality assurance program by which the Director assures the operation of internal auditing activities.
- Evaluate and assess significant functions and new or changing services, systems, processes, operations, and control processes coincident with their development, implementation, and/or expansion.
- Issue periodic reports to management, the Chancellor, Audit Committee and the Council of Internal Auditing providing results of audit activities.
- Keep the Chancellor and Audit Committee informed of emerging trends and successful practices in internal auditing.
- Assist and/or conduct the investigation of suspected fraudulent activities within the University in cooperation with the Chief of Police and/or General Counsel and notify the Chancellor and the Audit Committee of the results.
- Consider the scope of work of the external auditors and regulators, as appropriate, for the purpose of providing optimal audit coverage to the University.
- Participate in opening and closing conferences with external auditors.
- As appropriate, provide consulting services to management that add value and promote the best interests of the University.
- Ensure the requirements are met with regard to internal audit activities as set forth by the University of North Carolina Board of Governors and the Council of Internal Auditing
The Director and staff of the Office of Internal Auditing are authorized to:
- Have unrestricted access to all functions, systems, records, property, and personnel.
- Have full and free access to the Audit Committee.
- Allocate resources, set frequencies, select subjects, determine scope of work, and apply the techniques required to accomplish audit objectives.
- The Director and staff of the Office of Internal Auditing are not authorized to:
- Perform any operational duties for the organization or its affiliates.
- Initiate or approve accounting transactions external to the Office of Internal Auditing.
- Direct the activities of any organization employee not employed by the Office of Internal Auditing, except to the extent such employees have been appropriately assigned to auditing teams or to otherwise assist the internal auditors.
Standards of Audit Practice
In the performance of its responsibilities, the Office of Internal Auditing intends to adhere to the North Carolina Internal Audit Act, North Carolina Internal Audit Manual, Standards for the Professional Practice of Internal Auditing, Code of Ethics, and when appropriate, the Government Auditing Standards.