Training and Certification of Internal Auditors in the Public Sector and their Continuing Professional Development

Marija Matek, Marija Matek, Training Coordinator Training Coordinator for for Internal AuditorInternal Auditorss Ministry of Finance Ministry of Finance - Cro - Croaatiatia, , Central Harmonisation UnitCentral Harmonisation Unit Chisinau - Chisinau - Moldova, June 8 - 9 2011Moldova, June 8 - 9 2011

CONTENT

1. LEGAL BASE

- strategic documents

- legal framework

2. TRAINING PROGRAMME

- history

- overview

3. PROGRAMME COUNCIL

4. CONTINUING PROFESSIONAL DEVELOPMENT

1. Strategic documents

• PIFC Strategy 2009 - 2011- strengthening the capacity of internal auditors - number and competence

• Human Resources Development Strategy 2010 - 2013- training of civil servants- improvement of career development system and retention of quality staff- number of programs for promotion and career development

• Strategy and Action Plan against Corruption- measure 35 - Training of internal auditors and the persons responsible for the financial management and control

Legal framework of the training programme (1/2)

• Law on Public Internal Financial Control in the Public Sector

(OG 141/06) http://www.mfin.hr/hr/pifc-1-2

– Rulebook on user of budget internal audit (OG 35/08)

http://www.mfin.hr/hr/unutarnja-revizija-1-2-3

– Programme for professional training for certified public internal auditor (May 31, 2010)

– Instruction on the implementation of training and exams for the profession of a certified internal auditor in the public sector     (May 31, 2010)

Legal framework of the training programme (2/2)

• The decision on the amount of the costs of training, of how to release cost of training for the profession of a certified internal auditor in the public sector (June 1, 2010)

• Instruction on continuous professional training of internal auditors in the public sector (December 20, 2010)

- Catalog of training, knowledge base

• Direction on the implementation of mentoring in practical training for the profession of a certified internal auditor in the public sector (February 22, 2011)

http://www.mfin.hr/hr/izobrazba-unutarnjih-revizora

2. Training programme – a brief history

• 26 April 2004CARDS 2002 - Development of PIFC and Internal Audit

- 5 modules- Were held three rounds of training (~ 60 auditors)- Trainings for trainers (~ 15 trainers)- Mentoring

• 2007 - first redesigning of the programme- 7 modules - IT and accounting module separated in two modules, introduced a practical module

• 2010 - second redesigning of the programme- 5 modules (below ...)

Overview of training programme Overview of training programme

cca 8 -12 months

Practical experience (2 audits)

Module 1 – The role of internal audit in internal financial control system in public sector

Module 2 - The methodology of internal audit work

Module 5 - Applying the methodology of internal audit work on practical examples

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Module 4 - Financial management and accounting in the public sector

Module 3 – Auditing skills and techniques

Oral exam Written exam

Module 1 – Module 1 – The role of internal audit in internal The role of internal audit in internal financial control system in public sectorfinancial control system in public sector

• Education and profession of internal auditors

• Development and arrangement System of Internal Financial Control (PIFC) in accordance with international and EU standards

• Organization and carring out of internal audits in accordance with IIA and IPPF standards

• Components of Financial Management and Control (COSO)- Control environment- Planning and Risk Management- Control Activities- Information and communication- Monitoring and evaluation

• Code of ethics for internal auditors and internal audit roles in the prevention of risk of irregularities and fraud

• Presentations• Question and Answer• Exercise - Risk Assessment• Test - Ethics

Module 2 – The methodology of internal audit work

• Planning of internal audit

• Performing the internal audit

- Planning - Identification and recording system- Assessment of internal control systems- Testing the application and effectiveness

of controls- Assessment of Internal Control System- Reporting- Follow up

• Audit file and documentation standards

• Audit supervision

• Presentations• Case study• Exercise• Additional materials – Internal auditors maunual

Module 3 – Auditing skills and techniques

• Communication skills• Methods of collecting,

processing and presenting data

• Working meetings • Working relations and

teamwork• Interviewing and skills

techniques• Presentation skills• Skills of applying

information technology in audit work

• Presentations• Exercise – comunication, presentations,chairnig meetings, conduct interviews • Work in groups • Interactive communication

Module 4 - Financial management and accounting in the public sector

• Financial Management• General Accounting• Budget Accounting• Business Accounting• Analysis of accounting data • Managerial and Cost Accounting

• Presentations• Exercise• Interactive communication

Module 5. – Applying the methodology of internal audit work on practical examples

• Applying the methodology of performing an internal audit on a practical example

• Analysis of examples of audit reports

• Presentations• Case studies and examples from practice• Exercise in work groups • Discussion of solutions

Written ExamWritten Exam

• After completion of theoretical training (5 modules)

– Written Exam (100 questions)

• 25 questions from the module first to fourth- 5 questions YES-NO- 15 questions - one or more correct answers form offered- 5 questions - requires a descriptive answer

• Passage: 60 correct answers (60%)

Mentoring and oral exam

• Two practical audits under the supervision

- If the institution has an internal audit unit with experienced internal auditors - a mentor can be any of these internal auditors who has the certification and has done at least three audit reports

- If the institution has not (yet) established an internal audit unit and experienced internal auditors do not exist, the mentors are appointed by CHU

• Oral examination – two audit reports in front of committee for exam

Requirements for certification Requirements for certification

1. Attendance at all modules (M1- M5)

2. Passed a written exam

3. Made two audit reports (with supervisor/mentor)

4. Successfully completed the oral exam

Certification = 1 +2 +3 +4

3. Programme Council - Evaluation and Development

• Advisory body that provides CHU and consider proposals to ensure the development of quality vocational education

• Members are appointed by the Minister of Finance proposal CHU director from the circle of people with experience in the training of internal auditors and from persons with knowledge in a particular area of professional training for internal auditors

• The President is the head of CHU

4. Continuing Professional Development

• Instruction on the continuous professional training certified internal auditor

- Training Catalog- Sign in continuous professional development for the CHU- Common Knowledge (BoK)

OptionalOptional module module

• Internal audit of programms and projects financed by EU• Internal Audit of Information Systems• Internal audit of Financial Management system and Accounting

Areas of continuing professional development (workshops)

• Internal Audit• Accounting and Finance• Managing the public sector• Project Management • Information Technology• Mathematics, statistics and quantitative applications for

internal audit needs • Administrative and Labour Law• Human Resources Management• Public procurement• EU Funds

Seminars, conferences, ...Seminars, conferences, ...• Organizing CHU - Annual IA Seminar - every year• EU supported projects • HIIR• SIGMA

• Organised by other Institutions :

- PEM-PAL - Center of Excellence in Finance, Ljubljana - European Commission - IEDC - School of Management, Bled - IIA Conferences

Synopsis

• Methodological tool for a better compliance and content control activities of trainers (content, mode and time) before the modules start

• Components: - name of the programme- workshops name- speakers name - scope- objective- target group- content- key points- methodology- materials

- elaboration of the content - objectives-duration-notes for trainers

Evaluation

• The form consists of:

- assessment of trainers- assessment of materials- assessment of working area and equipment- comments and recommendations for improvement for each part of

module

• Program Council discuss the comments and grades of participant and upgrade and work on the quality of further education

We are proud of...

• Internal audit has become a profession that is recognized, accepted and appreciated in the public sector

• Certification is an integral part of the system of coefficients and salaries in public administration, public sector and local government

• Continuous activity that provides the necessary capacity in the public sector which is pleased by EK

• Certification of the public internal auditor is accepted in public sector enterprise

We are especially proud of

• IIA to us (IA) through the Internal Audit Capability Model (IA-CM) for Public Sector cited as the leading practice of internal auditing of public sector

We are especially proud of

• Recognition of good practice, by Robert de Koning’s book on PIFC

What we want in the future ...

• To be fully compliant with the IIA standards- 1230 - Continuing Professional Development

• The CPIA be accepted as part 4 IIA - CIA Exam• Influence the development of new studies of the internal audit of

the public sector in cooperation with the academic community• Explore and demonstrate the added value of public sector internal

audit• Write a book on the public sector internal audit• To be a recognized participant in the development of our country