The purpose of the Idaho State Board of Education’s Internal Audit and Advisory Services (IAAS) is to provide independent, objective and value-added assurance and advisory services to the Idaho State Board of Education and to Boise State University, Idaho State University, Lewis-Clark State College, and the University of Idaho. IAAS assists the system and universities achieve operating objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of governance, risk management and internal control processes.
Standards for the Professional Practice of Internal Auditing
IAAS will govern itself by adherence to the mandatory elements of the Institute of Internal Auditors International Professional Practices Framework, including the Core Principles for the Professional Practice of Internal Auditing, the Code of Ethics, the International Standards for the Professional Practice of Internal Auditing and the Definition of Internal Auditing. The Chief Audit Executive will report periodically to Audit Committee of the Idaho State Board of Education regarding internal audit conformance to the Code of Ethics and the Standards.
The Chief Audit Executive reports functionally to the Audit Committee of the Idaho State Board of Education and administratively to the Office of the Idaho State Board of Education. To establish, maintain and assure that the internal audit function has sufficient authority to fulfill its duties, the Audit Committee of the Idaho State Board of Education has the authority (supported by Board Policy VH, the SBOE Audit Committee Charter) to:
- Approve the IAAS audit charter on an annual basis
- Approve the risk-based internal audit plan
- Approve the internal audit function’s budget and resource plan
- Receive communications from the Chief Audit Executive on the internal audit function’s performance relative to its plan and other matters
- Make appropriate inquiries of University management and the Chief Audit Executive to determine if there are any inappropriate scope or resource limitations
- Have the authority to hire, evaluate and terminate the Chief Audit Executive (Subject to Board Policy and laws, regulations and policies of the State of Idaho)
- Review and approve compensation for the Chief Audit Executive (Subject to Board Policy and laws, regulations and policies of the State of Idaho)
The Chief Audit Executive has unrestricted access to communicate and interact with the Audit Committee of the State Board of Education, including private meetings without management present.
The Chief Audit Executive and internal audit staff are authorized to:
- Have full, free and unrestricted access to functions, systems, records, property and personnel relevant to carrying out any engagement or audit assignment, subject to accountability for confidentiality and safeguarding of records and information
- Allocate resources, set frequencies, select subjects, determine scopes of work, and apply techniques required to accomplish audit objectives and issue reports.
- Obtain assistance from personnel of the Board Office or University campuses in order to complete audit engagements and assignments.
- Obtain specialized assistance from within or outside the Board Office or the Universities in order to complete audit engagements.
- Within the constraints of professional independence standards, provide advisory services related to the development and/or implementation of policies, procedures, processes, controls or systems.
Independence & Objectivity
The Chief Audit Executive will ensure that IAAS remains free from all conditions that threaten the ability of internal auditors to carry out their responsibilities in an unbiased manner, including matters of audit selection, scope, procedures, frequency, timing and report content. If the Chief Audit Executive determines that independence or objectivity may be impaired in fact or appearance, the details of impairment will be appropriately disclosed.
Internal auditors will maintain an unbiased mental attitude that allows them to perform engagements objectively and in such a manner that they believe in their work product, that no quality compromises are made, and that they do no subordinate their judgment on audit matters to others.
The Chief Audit Executive and internal audit staff are not authorized to:
- Perform any operational duties of the Board of Education, the universities or their affiliates
- Initiate, modify, or approve transactions, policies, procedures processes or systems external to IAAS.
- Eliminate, implement or modify internal controls
- Direct activities of any Board or University employee not employed by IAAS, except to the extent they have been appropriately assigned to work for or assist IAAS.
At least annually, the Chief Audit Executive will confirm to the Audit Committee of the State Board of Education, the organizational independence of Internal Audit and Advisory Services.
The Chief Audit Executive will disclose to the Audit Committee of the State Board of Education, any interference and related implications in determining the scope internal auditing, performing work and/or communicating results.
The scope of internal audit activities encompasses, but is not limited to, objective examinations of audit evidence for the purpose providing independent assessments to the Audit Committee of the State Board of Education, the University Presidents and University Management, and outside parties on the adequacy and effectiveness of governance, risk management, and control processes for the Universities. Internal audit assessments include evaluating whether:
- Risks relating to the achievement of the strategic initiatives for the Board and Universities are appropriately identified and managed
- The actions of University Presidents, executives, officers, directors, employees and contractors are in compliance with Board and University policies, procedures, and applicable laws, regulations and governance standards.
- The results of operations or programs are consistent with established goals and objectives.
- Operations or programs are being carried out efficiently and effectively.
- Established processes and systems enable compliance with policies, procedures, laws and regulations that impact the Board or Universities
- Information and means used to identify, measure, analyze, classify and report such information are reliable and have integrity.
- Resources and assets are acquired economically, used efficiently and adequately protected.
The Chief Audit Executive will report periodically to the Audit Committee of the State Board of Education regarding:
- IAAS’s purpose, authority and responsibility
- IAAS’s audit plan and performance relative to its plan
- IAAS’s compliance with the IIA’s Code of Ethics and Standards, and action plans to address any significant conformance issues.
- Significant risk exposures and control issues, including fraud risks, governance issues, and other matters requiring the attention of the Audit Committee of the State Board of Education.
- Results of audit engagements or other activities
- Resource requirements
- Any response by management that may be unacceptable to the State Board of Education.
The Chief Audit Executive also coordinates activities, where possible and considers relying upon the work of their internal and external assurance consulting service providers as needed. IAAS may perform advisory and related client service activities, the nature and scope of which will be agreed upon with the client, provided IAAS does not assume management responsibility.
Opportunities for improving the efficiency of governance, risk management and control processes may be identified during engagements. These opportunities will be communicated to the appropriate level of management.
The Chief Audit Executive has the responsibility to:
- Submit, at least annually, to the Audit Committee of the State Board of Education a risk-based internal audit plan for review.
- Communicate to the Audit Committee of the State Board of Education the impact of resource limitations on the internal audit plan.
- Review and adjust the internal audit plan, as necessary, in response to changes in the State Board of Education or individual University business, risks, operations, programs, systems and controls.
- Communicate to the Audit Committee of the State Board of Education any significant interim changes to the internal audit plan.
- Direct audit staff at Boise State University, Idaho State University, the University of Idaho and Lewis-Clark State College.
- Administer audit resources at Boise State University, Idaho State University, the University of Idaho and Lewis-Clark State College.
- Ensure each engagement of the internal audit plan is executed, including the establishment of objectives and scope, the assignment of appropriate and adequately supervised resources, the documentation of work programs and testing results, and the communication of engagement results with applicable conclusions and recommendations to appropriate parties.
- Follow up on engagement findings and corrective actions, and report periodically to University management and the Audit Committee of the State Board of Education any corrective actions not effectively implemented.
- Ensure principle of integrity, objectivity, confidentiality and competency are applied and upheld
- Ensure that IAAS collectively possesses or obtains the knowledge, skills and other competencies needed to meet the requirements of the internal audit charter
- Establish and ensure adherence to policies and procedures designed to guide IAAS.
- Ensure adherence to the Board of Education’s relevant policies and procedures unless such policies and procedures conflict with the internal audit charter. Any such conflicts will be resolved or otherwise communicated to the Chief Financial Officer of the State Board of Education and the Audit Committee of the State Board of Education
- Ensure conformance with the Standards, with the following qualifications:
- If IAAS is prohibited by law or regulation from conformance with certain parts of the Standards, the Chief Audit Executive will ensure appropriate disclosures and will ensure conformance with other parts of the
- If the Standards are used in conjunction with requirement issued by other professional authoritative bodies, the Chief Audit Executive will ensure that IAAS conforms with the Standards, even if IAAS conforms with more restrictive requirements of other authoritative bodies.
Quality Assurance and Improvement Program
IAAS will maintain a quality assurance and improvement program that covers all aspects of IAAS operations. The program will include an evaluation of IAAS’s conformance with the Standards and an evaluation of whether internal auditors apply the IIA’s Code of Ethics. The program will also assess the efficiency and effectiveness of IAAS and identify opportunities for improvement.
The Chief Audit Executive will communicate to the Audit Committee of the State Board of Education IAAS’s quality assurance and improvement program, including results of internal assessments (both ongoing and periodic) and external assessments conducted at least once every five years by a qualified, independent assessor or assessment from outside Idaho higher education.