Adrian C H Koh, LL.M MSc FICA

Auditing Research and Treasury In my present job at the Foundation for Auditing Research one big challenge is to show practical relevance of academic auditing research. Well, there is a lot indeed for the audit sector, but also for other finance professionals. Let me give you an example for Treasury simply based on one publication of W. Robert Knechel called "The Future of Assurance in Capital Markets: Reclaiming the Economic Imperative of the Auditing Profession" (American Accounting Association, 2020). This article summarizes the following academic evidence/findings (from diverse empirical research): - audits are valuable to market participants - external audits reduce risk to external stakeholders - auditing reduces a company's cost of capital - private companies benefit from audits in obtaining loans - auditor quality is associated with a lower cost of debt - other benefits of an audit include: fewer accounting errors, more efficient market reaction to earnings and reduced fraud risk. So these statements not only intuitively make sense but there is also clear academic evidence for them. For a Treasurer who is always interested in lowering capital cost this should be of value! #Foundationforauditingresearch #auditing #treasury #DACT

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Strategic Auditing for Organizations or Auditing Organizations’ Strategies

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On Governance: The Global Internal Audit Standards emphasize a direct reporting relationship between the Chief Audit Executive and the Board. However, governance arrangements differ significantly among public sector and private sector entities, legal structures, and industries. As a result, the Standards provide a broad definition of the term "Board" to encompass a wide range of governance bodies, including: ·      A Board of Directors ·      An Audit Committee ·      A Board of Governors or Trustees ·      A Group of Elected Officials or Political Appointees ·      Another Body that has Authority Over Governance Functions #Governance #InternalAuditStandards #InternalAuditAwareness

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#IFRB 2024/06: New IFRS 19 - Disclosures for Subsidiaries without Public Accountability The IASB issued IFRS 19 Subsidiaries without Public Accountability: Disclosures on May 9, 2024. This new standard allows certain entities to apply the full measurement requirements of IFRS but with significantly reduced disclosures. #BDO IFRS Bulletin contains everything you need to know about IFRS 19, including the criteria an entity must meet to apply the standard, the effective date and more. Learn more on our website https://lnkd.in/dU3d-kfB Contact BDO in Ukraine for more information and advice https://lnkd.in/ddaYbw94 #IFRB #IFRS19 #IASB #BDO #BDOUkraine #Accounting #Subsidiaries #PublicReporting

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"Enterprise-wide Risk Management or just Enterprise Risk Management is a term in common use. COSO has defined it as: "a process, effected by an entity's board of directors, management and other personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may affect the entity, and manage risk to be within its risk appetite, to provide reasonable assurance regarding the achievement of entity objectives." (p.6) "Assurance: a process that provides a level of confidence that objectives will be achieved within an acceptable level of risk." (p.6) "External Audit: the examination by an independent third party of the financial report of a company or other organization, resulting in the publication of an opinion on whether the financial report is presented fairly, in all material respects, and has been prepared in accordance with an applicable financial reporting framework. " (p.8) "Internal auditing: an independent, objective assurance and consulting activity designed to add value and improve an organization's operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes." (p.8) "The Handbook also provides a guide to assessing the adequacy of risk management framework and process. Following the processes in this Handbook will help organizations to assess whether management has designed and implemented the risk management and internal control system to manage the company's material risks and reported whether those risks are being managed effectively and provide analysis and independent appraisal of the adequacy and effectiveness of the company's risk management and internal control system" p.5 HB 158-2010 Delivering Assurance Based on ISO 31000:2009 Risk Management- Principles and Guidelines #risk #risks #enterpriserisk #enterprisesecurityriskmanagement #intelligence #threatlintelligence #riskmanagement #riskanalysis #riskassessment #riskmanagementframework #operationalriskmanagement #projectriskmanagement #projectrisk #operationalresilience #resilience #operationalrisk #riskintelligence #governance #safety #safetyfirst #safetymanagement #safetyassessment #safetyrisks #safetyculture #safetyanalysis #personalsafety #workplacesafety #healthandsafety #hazard #danger #peril #threat #PPE #protectivesafety #workplacesafety #security #securityriskmanagement #securitymanagement #securityrisks #enterprisesecurity #cybersecurity #physicalsecurity #informationsecurity #digitalsecurity #securityoperations #enterprisesecurityriskmanagement #securityassessment #intelligence #threatlintelligence #risk #riskmanagement #travelsecurity #travelsafety #travel #businesstravel #tourism #travelrisks #travelriskmanagement

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Using the business model canvas to improve audit processes The study aims to determine whether auditors can use a business model canvas in their operations and how it increases the auditing value. This paper uses qualitative methods, including in-depth interviews with 37 internal auditors. It shows that the current channel of communicating audit assumptions with requesters is insufficient to facilitate audit processes. The auditors’ communication with their clients is limited by being in their knowledge area. The study presents a modified business model canvas, which fits auditors’ needs. The proposed changes rely on a different sequence of the traditional Osterwalder’s Canvas building blocks. Besides, modified Osterwalder’s model includes Mission, Impact, and Accountability blocks. These blocks, added to the model, make aware audit parties that the auditors are mission-focused and impact-driven on audited organisations and their environment. Adopting the business model canvas framework in the audit process showed potential, as auditors can better explain audit goals and limitations. https://lnkd.in/di_k_B82

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Using the business model canvas to improve audit processes The study aims to determine whether auditors can use a business model canvas in their operations and how it increases the auditing value. This paper uses qualitative methods, including in-depth interviews with 37 internal auditors. It shows that the current channel of communicating audit assumptions with requesters is insufficient to facilitate audit processes. The auditors’ communication with their clients is limited by being in their knowledge area. The study presents a modified business model canvas, which fits auditors’ needs. The proposed changes rely on a different sequence of the traditional Osterwalder’s Canvas building blocks. Besides, modified Osterwalder’s model includes Mission, Impact, and Accountability blocks. These blocks, added to the model, make aware audit parties that the auditors are mission-focused and impact-driven on audited organisations and their environment. Adopting the business model canvas framework in the audit process showed potential, as auditors can better explain audit goals and limitations. https://lnkd.in/di_k_B82

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Using the business model canvas to improve audit processes The study aims to determine whether auditors can use a business model canvas in their operations and how it increases the auditing value. This paper uses qualitative methods, including in-depth interviews with 37 internal auditors. It shows that the current channel of communicating audit assumptions with requesters is insufficient to facilitate audit processes. The auditors’ communication with their clients is limited by being in their knowledge area. The study presents a modified business model canvas, which fits auditors’ needs. The proposed changes rely on a different sequence of the traditional Osterwalder’s Canvas building blocks. Besides, modified Osterwalder’s model includes Mission, Impact, and Accountability blocks. These blocks, added to the model, make aware audit parties that the auditors are mission-focused and impact-driven on audited organisations and their environment. Adopting the business model canvas framework in the audit process showed potential, as auditors can better explain audit goals and limitations. https://lnkd.in/di_k_B82

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The Role of Internal Audit: Does Management Really Understand It? Internal auditors play a crucial role in organizations by evaluating and improving, control, and governance processes. However, they often face challenges due to a lack of recognition and cooperation from management. This situation can compromise the effectiveness of their assessments and the implementation of organizational improvements. This article explores the function of internal audit, its importance, and how management can better collaborate with internal auditors to achieve the organization’s strategic objectives. https://lnkd.in/eV6vyB5a #auditor #compliance #government #auditing #fraud #iso #ethics #accounting #business #privacy #riskmanagement #boardofdirectors #businessethics #management

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The COSO Internal Control Framework discusses the scope of internal auditing in a manner that is inconsistent with Institute of Internal Auditors Standards and Guidance (See excerpt below 👇). Can you identify which word is inconsistent with IIA Standards and Guidance? And what it should be replaced with? #InternalAuditAwarenessMonth

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📰 New Article Alert 📰 in our Digital Transformation SI: "Current auditor expertise and future relevance of innovative audit technology: evidence from Indonesia public sector auditor" by M. Rizal Yahya, Jalaluddin, and Gamal Batara. #Indonesia #Auditor #Technology #Asia #PublicAdministration Abstract: The COVID-19 pandemic has inevitably accelerated technology adoption in almost all industries, including the auditing industry. Indonesia’s supreme audit institution (Badan Pemeriksa Keuangan-Republik Indonesia – BPK-RI) as a government auditor had to use remote audit technologies in conducting state financial audits. Despite the widespread adoption of digital technologies in public administrations, little attention has been paid to the expertise level of auditors as the main users of audit technologies. This study aims to investigate current auditor expertise, and the future importance, of 18 innovative audit technologies identified from relevant studies. In addition, this study also aims to compare the importance of the technologies with current auditor expertise to identify the relevance-knowledge gap (expertise gap). We surveyed state external auditors (supreme auditors) from Badan Pemeriksa Keuangan Republik Indonesia – BPK-RI. We used t-test and deviation analysis to analyse the data. Cloud computing, self-service reports, and scanbots are perceived as the most relevant technologies, and auditors perceive their knowledge of most technologies as moderate. The results also reveal an expertise gap ranging from moderate to high across all the innovative audit technologies. It appears crucial for policymakers to focus on educational efforts to bridge this gap. https://lnkd.in/diWjsws3

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🔍 The Power of Internal Audit in Strengthening Business Integrity In today’s complex business landscape, internal audit is more than just a compliance function—it’s a critical component of organizational success. Internal audit serves as the eyes and ears of management, providing objective assurance that an organization’s risk management, control, and governance processes are functioning as they should. Here's why internal audit matters: Risk Mitigation: By identifying potential risks early, internal audit helps organizations navigate challenges before they escalate. Process Improvement: Auditors often uncover inefficiencies and recommend process enhancements, which can lead to cost savings and improved productivity. Strengthening Governance: Internal audit helps ensure adherence to laws, regulations, and internal policies, maintaining the integrity of the organization. Strategic Insight: With access to various functions, internal auditors provide valuable insights that can shape strategic decisions. Whether it’s enhancing operational efficiency or safeguarding against fraud, the role of internal audit has never been more critical in safeguarding an organization’s long-term health. Let’s embrace the strategic potential of internal audit! 🚀 #InternalAudit #RiskManagement #CorporateGovernance #BusinessIntegrity #ProcessImprovement #AuditInsights

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💡 𝐇𝐨𝐰 𝐡𝐚𝐯𝐞 𝐭𝐡𝐞 𝐈𝐈𝐀 𝐒𝐭𝐚𝐧𝐝𝐚𝐫𝐝𝐬 𝐞𝐯𝐨𝐥𝐯𝐞𝐝 𝐟𝐫𝐨𝐦 𝟐𝟎𝟏𝟕 𝐭𝐨 𝟐𝟎𝟐𝟒?  🔎𝑫𝒊𝒔𝒄𝒐𝒗𝒆𝒓 𝒕𝒉𝒆 𝑲𝒆𝒚 𝑪𝒉𝒂𝒏𝒈𝒆𝒔 𝒊𝒏 𝑰𝒏𝒕𝒆𝒓𝒏𝒂𝒍 𝑨𝒖𝒅𝒊𝒕 𝑺𝒕𝒂𝒏𝒅𝒂𝒓𝒅𝒔 ▪️ Introduction to Changes ▪️ New Terms Introduced ▪️ Significant Definition Changes ▪️ Omitted Terms in 2024 ▪️ Implications for Practice ▪️ Conclusion and Reference 📢 Read the full IIA Standards 2024: https://lnkd.in/gEjxmhKK 📢 𝐂𝐥𝐢𝐜𝐤 𝐢𝐧 𝐛𝐞𝐥𝐨𝐰 𝐥𝐢𝐧𝐤 𝐭𝐨 𝐫𝐞𝐚𝐝 𝐦𝐨𝐫𝐞: https://lnkd.in/gXBBe72C #iia #iiastandards #internalaudit #InternalAuditStandards #challenges #methodologies #Risk #InternalAuditFunction #governance #riskmanagement

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A little further dive into risk-based auditing, Should external auditors become part of a client's risk management strategy? Share your thoughts in the comments section 💯 Nevens Consulting

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#businesscontinuity #riskmanagement "In the context of Industry 4.0 companies, it is proposed to take into consideration following categories of potential disruption reasons: • failures in logistics chains, delays in delivery of raw materials or semi-finished products by the business partners, and/or delays in providing services, spare parts etc., • physical or cyber attack, • failures and outages of the ICT and CT (cloud technology) systems and networks designed using the wire and/or wireless technology, • failures and outages of the OT systems and networks including production lines and storage, and/or malfunctions of the industrial automation and control system (IACS), • extremal environmental phenomena, storm with lightning, heavy rain, local flooding, flood, hurricane, or tornado, extremely high or low temperature, great snowfall, icing etc., • disturbances in the critical infrastructure objects and systems to deliver water, electricity, gas etc., • fire and/or explosion due to various reasons, • extremal emission of pollutants and/or danger substances, • destruction due to potential critical events in surroundings and infrastructure installations, • failure to comply the product quality or safety requirements, • failure to meet health or sanitary requirements, bad quality or pollution of products, • cases of potential bacteria diseases (e.g., due to errors in the ventilation system maintenance and/or disinfection), or infectious virus leading to an epidemic or pandemic situation, • earthquake, and/or tsunami at some sites close to the ocean shore, • sabotage, terrorism, or cyberterrorism on the critical infrastructure objects/systems inspired by an external principal or agent. (p.251-252) "An event can be occurrence or change of a particular set of circumstances that could have several causes and several consequences. An abnormal event due to a hazard or threat is considered as a source of risk. An emergency is a result of sudden, urgent, usually unexpected occurrence, or event requiring immediate action. Emergency is under- stood as a disruption or condition that can be anticipated or prepared for, but seldom exactly fore- seen " (p.251) Kosmowski, K. (2021). Business continuity management framework for Industry 4.0 companies regarding dependability and security of the ICT and ICS/SCADA system, Safety and Reliability of Systems and Processes, Summer Safety and Reliability Seminar 2021 #safety #safetyfirst #safetymanagement #safetyassessment #safetyrisks #safetyculture #safetyanalysis #personalsafety #workplacesafety #healthandsafety #hazard #danger #peril #threat #PPE #protectivesafety #workplacesafety #security #securityriskmanagement #securitymanagement #securityrisks #enterprisesecurity #cybersecurity #physicalsecurity #informationsecurity #digitalsecurity #securityoperations #enterprisesecurityriskmanagement #securityassessment #intelligence #threatlintelligence #risk #riskmanagement

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𝑨𝒕 𝑳𝒆𝒂𝒔𝒕 𝒐𝒏𝒄𝒆 𝒆𝒗𝒆𝒓𝒚 5️⃣ 𝒚𝒆𝒂𝒓𝒔🔍 ⭕Standard 8.4 External Quality Assessment⭕ ➟ Standard 8.4 of the GIAS focuses on the requirements for conducting an External Quality Assessment (EQA). ➟ The standard mandates that the Chief Audit Executive must develop a plan for an EQA and discuss this plan with the Board or Audit Committee  ➟The purpose of an EQA is to evaluate the internal audit function's conformance with GIAS. ➟The EQA serves as a benchmark for assessing the internal audit activity, helping to identify areas of partial or non-conformance and providing metrics for improvement. ➟This process ensures that the internal audit function maintains high standards of quality and effectiveness, aligning with the organization's objectives and regulatory requirements. 𝑲𝒆𝒚 𝑨𝒃𝒃𝒓𝒆𝒗𝒊𝒂𝒕𝒊𝒐𝒏𝒔 𝑪𝑰𝑨: Certified Internal Auditor 𝑪𝑨𝑬: Chief Audit Executive 𝑸𝑨: Quality Assessment 𝑰𝑨: Internal Audit 🔗𝑩𝒖𝒊𝒍𝒅𝒊𝒏𝒈 𝒐𝒏 𝒕𝒉𝒆 𝑺𝒆𝒓𝒊𝒆𝒔 I'm breaking down the new Global Internal Audit Standards! Check out my previous posts: ✅Standard 1.1: Honesty and Professional Courage https://lnkd.in/dG4YYa3i ✅Standard 1.2: Organization's Ethical Expectations https://lnkd.in/dEcZmRPU ✅Standard 1.3: Legal and Ethical Behavior https://lnkd.in/dEpGjwfk ✅Standard 2.1: Individual Objectivity https://lnkd.in/dbxMjz4b ✅Standard 2.2: Safeguarding Objectivity https://lnkd.in/d5EzDYJe ✅Standard 2.3: Disclosing Impairments to Objectivity https://lnkd.in/dWCyFZjp ✅Standard 3.1 Competency https://lnkd.in/dtSmCvWY ✅Standard 3.2 Continuing Professional Developmenthttps://lnkd.in/d5z-2xrg ✅Standard 4.1 Conformance with the Global Internal Audit Standards https://lnkd.in/dKKJexpP ✅Standard 4.2 Due Professional Care https://lnkd.in/dA7-a3xH ✅Standard 4.3 Professional Skepticism https://lnkd.in/dWMMfA-k ✅Standard 5.1: Use of Information https://lnkd.in/dBkSUDEz ✅Standard 5.2 Protection of Information https://lnkd.in/dgTENasY ✅Standard 6.1 Internal Audit Mandate https://lnkd.in/dreXpVtB ✅Standard 6.2 Internal Audit Charter https://lnkd.in/dPc4xCCf ✅Standard 6.3 Board and Senior Management Support https://lnkd.in/d7NtcyUN ✅Standard 7.1 Organizational Independence https://lnkd.in/dcgZVATx ✅Standard 7.2 Chief Audit Executive Qualifications https://lnkd.in/dTDhXnxt ✅Standard 8.1 Board Interaction https://lnkd.in/ewjNkuAV ✅Standard 8.2 Resources https://lnkd.in/dh9YCTEu ✅Standard 8.3 Quality https://lnkd.in/d5fx-9im 🔥#One_Pager_Standard #GIAS #GIASSeries #internalaudit #IIA #Khattab #Quick_audit_tips

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