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Internal Audit of the E stonian Financial Supervisory Authority ( EFSA ). Raivo Linnas Internal Auditor Tallinn, Estonia – June 2 9 , 2004. Curriculum Vitae - I. From 01/2002 – Internal Auditor of the EFSA. - PowerPoint PPT Presentation
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1
Internal Audit of the
Estonian Financial Supervisory Authority (EFSA)
Raivo LinnasInternal Auditor
Tallinn, Estonia – June 29, 2004
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Curriculum Vitae - I
From 01/2002 – Internal Auditor of the EFSA.
10/1998 – 01/2002 – Head of Performance Audit Department, Deputy Auditor General, The State Audit Office.
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Curriculum Vitae - II
08/1994 – 07/1998 – Chairman, Director 08/1994 – 07/1998 – Chairman, Director General, and Member of Management General, and Member of Management Board in 2 Insurance Companies;Board in 2 Insurance Companies;
09/1993 – 05/1994 – Vice Chairman, 09/1993 – 05/1994 – Vice Chairman, Member of Board of the Eesti Member of Board of the Eesti Sotsiaalpank.Sotsiaalpank.
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Curriculum Vitae - IIIFrom 04/2004 – Affiliate Member of the
IIA of UK and Ireland.From 1985 - Dipl. Eng.Former Lecturer of the Estonian
Business School.
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About the EFSA - IEstablished on 01.01.2002;An agency created by the Riigikogu; With autonomous competence and a
separate budget and management; Independent in the conduct of financial
supervision; United Financial Supervision Authority;The Financial Supervision Authority Act.
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About the EFSA - IIAbout 65 Employees;The Council (6 members, including
Ministry of Finance, GBoE)The Management Board (5 members);8 Departments, IA, IS, PR.About 70 Entities to be Supervised, incl
Issuers.Budget of 2004 – circa 2.7 million EUR.
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Place of Internal Audit Unit in the EFSA Directly accountable to the
Management Board. No statutory links with Supervisory
Council. No Audit Committee.
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Legal Framework
FSA § 18.3.9;IA Reglement (Charter);Job Description of IA;Code of Ethics of IA;Contract of Employment of IA.Fixed-term Contract for 2+2 years.
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Mission
To help Management Board achieve goals and objectives in best way
with most reasonable consumption of resources.
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Goals and ObjectivesTo add value and develop the EFSA’s:
Management and Organizational Culture; and
Control Environment.To evaluate and improve the
effectiveness of risk management, control and governance processes.
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Tasks and Responsibilities of IA
Internal Audit Function;Handling of Conflict of Interests Issues; Risk Management Function
(secondary);Promote Quality Management;Promote Appropriate Ethics and Values
within the EFSA.
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Rights of IA - I
To be Independent in Planning, Scoping and Performing Audits and Investigations;
Immidiate Direct Access to CMB and MB in Corpore;
Access to all Files, Accounts, Processes, Property and Data.
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Rights of IA - II
Interview all Staff, incl Members of Management Board (MMB);
Interview all Contractors and Representatives of Entities Under Supervision;
Take Part in meetings of MB and other relevant meetings;
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Rights of IA - IIIReject all tasks in case of risk of
incompetence, conflict of interests or unobjectivity;
Contract Independent External Expert(s);Involve Personnel of EFSA in Audits and
Investigations;Continuing development of knowledge,
skills, and other competencies.
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Scope
All Fields of Activity of the EFSA;All functions and projects;All systems and processes;Entire Staff, incl MMB;All Structural Units.
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Approach
Risk Based.Implementing The IIA Internal Audit
Standards as well as possible.No full compliance with the IIA IAS as of
today.
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Planning
1. Strategic Plan (3-5 years);2. Quarterly Plan; (Time-Resource Based)3. Plan of Particular Audit.
SP and QP to be Confirmed by MB.
PPA to be Consulted with Chairman.
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Reporting
The Case Report of Audit Results to the CMB and/or MB.
Quarterly Report to the MB.Annual Report of Activity to the MB.Annual Report of Self-Assessment to
the CMB.
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Content of QR - I
I Report of Most Important Activities (Execution vs Plans).
II Observations of Most Important Risks.III Report of All Activities by Areas of
Responsibility. (Execution vs Plans).
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II Observations of Most Important Risks - IRisks of Communication and
Disclosure;Financial Risks;Risks of Planning and Budgeting; Risks of Unachivement of Goals and
Objectives;Risks of Image;
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II Observations of Most Important Risks - II
Risks of Supervision;Risks of Handling Confidential Information;Observations on Risk Management;Observations on Control Environment;Observations on Corporate Governance;Observations on Conflict of Interests Issues;Observations on Fraud and Misusement;Varie.
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Assessment
Self-Assessment of Each Particular Audit.
Annual Self-Assessment. Annual Internal Assessment.Annual Appraisal. External Assessment (At once in 3
years).
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Audit Process
5 Stages and 12 StepsPlanning (4 Steps);Conducting (1 Step);Drafting Results (3 Steps);Disclosure (1 Step);Assessment (2 Steps);Follow-up (1 Step).
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Risks of Particular ModelRisk of Discontinuity;Risk of Incompetence;Risk of Independence;Risk of Divisibility;Risk of Shortage of Ideas.No Time for Deeper and Longer
Engagements.
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Strengths
Clear Responsibility.Efficiency of Ressource Consumption.No Opposition with MB.
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Audit failing
Standardized and Formalized;Traditional;Digital.
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Thank you very much for your Thank you very much for your attentionattention!!