Internal Audit Charter
Internal Audit Charter
The purpose of this charter is to provide in summary form a general understanding of the role and responsibilities of internal auditing within Brownsville Independent School District.
Objective & Scope
The objective of internal auditing is to assist members of the District in the effective discharge of their responsibilities. To this end, internal auditing furnishes them with analyses, appraisals, recommendations, and information concerning the activities reviewed. The audit objective includes promoting effective control at reasonable cost.
The scope of internal auditing encompasses the examination and evaluation of the adequacy and effectiveness of the District’s system of internal control and the quality of performance in carrying out assigned responsibilities and achieving established objectives. The scope of internal auditing includes:
Evaluating the reliability and integrity of financial, operating, and performance information and the means used to identify, measure, classify, and report such information.
Analyzing the systems established to ensure compliance with those policies, plans, procedures, laws, and regulations that could have a significant impact on operations and reports, and determining whether the District is in compliance.
Reviewing the means of safeguarding assets and, as appropriate, confirming the existence of such assets.
Appraising the economy and efficiency with which resources are employed.
Assessing operations and programs to ascertain whether results are consistent with established objectives and goals.
The internal auditor should be independent of the activities audited. Independence permits the auditor to render the impartial and unbiased judgments essential to the proper conduct of audits. Independence is achieved through organizational status and the auditor’s mental attitude in performing assigned audits. In order to retain the highest degree of independence and objectivity, internal audit has a reporting responsibility to the Board of Trustees.
Internal audit activities should be performed with proficiency and due professional care. Audit personnel are responsible for continuing their education in order to maintain proficiency and technical competence. The auditor should be kept informed of improvements and current developments in internal auditing standards, procedures, and techniques and should be provided continuing education through membership and participation in professional societies; attendance at conferences and seminars; and participation in self-study programs.
Due Professional Care
The auditor should use reasonable audit skill and judgment and exercise due professional care in performing every audit. The internal auditor is required to conduct examinations and verifications of the activity under audit to a reasonable extent, but is not required to perform detail audits of all transactions. Accordingly, the internal auditor cannot give absolute assurance that noncompliance or irregularities do not exist. Nevertheless, the possibility of material irregularities or noncompliance should be considered whenever the internal auditor undertakes an auditing assignment.
Types of Audits
Internal audit will perform the following types of audit, review, and analysis activities:
Financial audits will focus on the review of specific financial transactions and operating data, to ensure the reliability and accuracy of the District’s financial and operating reports.
Compliance audits seek to determine whether the department or campus under review has complied with the applicable statutory laws, regulations, District policies and procedures, and commonly accepted principles of good management.
Operational audits involve an independent, systematic evaluation of the activities under review for the purpose of improving organizational and operating effectiveness. The operational audit seeks to ensure the maximum benefit received for the resources expended.
These audits involve the review of entire programs for the purpose of determining whether desired benefits are being achieved. “Program” is a broad term that encompasses any funded effort that is collateral to the core instructional activities of the District. A program includes the composite plans and procedures established to accomplish specific goals and objectives.
Investigative audits are generally unplanned and may result from findings during a routine audit or from information received from management, employees, or the general public.
A confidential audit plan and schedule will be submitted to the Board of Trustees by December of each year for approval, describing suggested activities for the next fiscal year. The schedule should list all departments, programs, and activities subject to review within the next fiscal year.
It is the responsibility of the department manager or campus administrator to make available to the auditor all financial records, documentation, and access to key individuals that are related to the audit being conducted. The auditor cannot be expected to be completely knowledgeable about all activities, systems, procedures, and programs within the organization. The auditor cannot be expected to search all files in the auditee’s office or to master all procedures in a limited time without full cooperation of the department or area under review.
Audit Work paper Retention
It is the policy of the District that all audit work papers and audit reports be kept for five and ten years, respectively. A longer retention period for special audits may be determined by the auditor’s professional judgment.
The internal auditor can contribute a wealth of information to the organization over and above the assurance provided by evaluating the quality of control systems and ongoing operations. The auditor should demonstrate an in-depth understanding of the strengths and weaknesses of the District, its accomplishments and current problems, the quality of its services, the concerns of its employees, and efficiencies and diseconomies of its operations.
This policy statement is meant to serve as a framework to guide the internal auditor in accomplishing assigned responsibilities. It is intended to be flexible enough to remain applicable as the auditing profession changes and as the structure and operations of the District and the individual campuses change through growth and reassessed needs.