Purpose and Mission

The purpose of Saint Joseph’s University’s (the “University”) Internal Audit department is to provide independent, objective assurance and consulting services designed to add value and improve University operations. The mission of internal audit is to add value and improve University operations by providing risk-based and objective assurance, advice, and insight. The internal audit department helps the University accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of governance, risk management, and control processes.

Standards for the Professional Practice of Internal Auditing

The internal audit department 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, and the International Standards for the Professional Practice of Internal Auditing, and the Definition of Internal Auditing. The Director of Internal Audit[1] will report periodically to senior management and the Audit & Risk Committee (the Committee) regarding the internal audit department’s conformance to the Code of Ethics and the Standards.

Authority

The Director of Internal Audit will report functionally to the Committee and administratively (i.e., day-to-day operations) to the Vice-President of Finance & Administration and Treasurer (Officer).To establish, maintain, and assure that the University’s internal audit department has sufficient authority and independence to fulfill its duties, the Committee will:

  • Approve the internal audit department’s charter.
  • Approve the risk-based internal audit and related resource plan.
  • Receive communications from the chief audit executive on the internal audit department’s performance relative to its plan and other matters.
  • Approve decisions regarding the appointment and removal of the Director of Internal Audit.
  • Make appropriate inquiries of management and the Director of Internal Audit to determine whether there is inappropriate scope, independence or resource limitations.

The Chair of the Committee and the Vice-President of Finance & Administration will approve the annual performance appraisal and remuneration of the Director of Internal Audit.

The Director of Internal Audit will have unrestricted access to, and communicate and interact directly with, the Committee, including in private meetings without management present.

The Committee authorizes the internal audit department to:

  • Have full, free, and unrestricted access to all functions, records, property, and personnel pertinent to carrying out any engagement, subject to accountability for confidentiality and safeguarding of records and information.
  • Allocate department resources, set frequencies, select subjects, determine scopes of work, apply techniques required to accomplish audit objectives, and issue reports.
  • Obtain assistance from the necessary personnel of the University, as well as other specialized services from within or outside the University, in order to complete the engagement.

Independence and Objectivity

The Director of Internal Audit will ensure that the internal audit department 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 Director of Internal Audit determines that independence or objectivity may be impaired in fact or appearance, the details of impairment will be disclosed to appropriate parties.

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 not subordinate their judgment on audit matters to others.

Internal auditors will have no direct operational responsibility or authority over any of the activities audited. Accordingly, internal auditors will not implement internal controls, develop procedures, install systems, prepare records, or engage in any other activity that may impair their judgment, including:

  • Assessing specific operations for which they had responsibility within the previous year.
  • Performing any operational duties for the University or its affiliates.
  • Initiating or approving transactions external to the internal audit department.
  • Directing the activities of any University employee not employed by the internal audit department, except to the extent that such employees have been appropriately assigned to auditing teams or to otherwise assist internal auditors.

Where the Director of Internal Audit has or is expected to have roles and/or responsibilities that fall outside of internal auditing, safeguards will be established to limit impairments to independence or objectivity.

Internal auditors will:

  • Disclose promptly any impairment of independence or objectivity, in fact or appearance, to appropriate parties.
  • Exhibit professional objectivity in gathering, evaluating, and communicating information about the activity or process being examined.
  • Make fair and objective assessments of all available and relevant facts and
  • Take necessary precautions to avoid being unduly influenced by their own interests or by others in forming

The Director of Internal Audit will confirm to the Committee, at least annually, the organizational independence of the internal audit department.

The Director of Internal Audit will disclose to the Committee any interference and related implications in determining the scope of internal auditing, performing work, and/or communicating results.

Scope of Internal Audit Activities

The scope of internal audit activities encompasses, but is not limited to, objective examinations of evidence for the purpose of providing independent assessments to the Committee, management, and outside parties on the adequacy and effectiveness of governance, risk management, and control processes for the University. Internal audit assessments include evaluating whether:

  • Risks relating to the achievement of the University’s strategic objectives are appropriately identified and managed.
  • The actions of the University’s officers, trustees, advisory boards, employees, and contractors are in compliance with the University’s policies, procedures, and applicable laws, regulations, and not-for-profit higher education governance prudent practices.
  • The results of operations or programs are consistent with established University goals and objectives.
  • Operations or programs are being carried out effectively and efficiently.
  • Established processes and systems enable compliance with the policies, procedures, laws, and regulations that could significantly impact the University.
  • Information and the 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 protected adequately.

The Director of Internal Audit will report periodically to the Officer and the Committee regarding:

  • The internal audit department’s purpose, authority, and responsibility.
  • The internal audit department’s plan and performance relative to its plan.
  • The internal audit department’s conformance 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, or requested by, the Committee.
  • Results of audit engagements or other activities.
  • Resource requirements.
  • Any response to risk by management that may be unacceptable to the University.

The Director of Internal Audit also coordinates activities, where possible, and considers relying upon the work of other internal and external assurance and consulting service providers as needed. The internal audit department may perform advisory and related client service activities, the nature and scope of which will be agreed with the client, provided the internal audit department 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.

Responsibility

The Director of Internal Audit has the responsibility to:

  • Submit, at least annually, to the Officer and the Committee a risk-based internal audit plan for review and approval.
  • Communicate to senior management and the Committee 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 University’s business, risks, operations, programs, systems, and controls.
  • Communicate to senior management and the Committee any significant interim changes to the internal audit plan.
  • 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 senior management and the Committee any corrective actions not effectively implemented.
  • Ensure the principles of integrity, objectivity, confidentiality, and competency are applied and upheld.
  • Ensure the internal audit department collectively possesses or obtains the knowledge, skills, and other competencies needed to meet the requirements of the internal audit charter.
  • Ensure trends and emerging issues that could impact the University are considered and communicated to senior management and the Committee as appropriate.
  • Ensure emerging trends and successful practices in internal auditing are considered.
  • Establish and ensure adherence to policies and procedures designed to guide the internal audit department.
  • Ensure adherence to the University’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 senior management and the Committee.
  • Ensure conformance of the internal audit department with the Standards, with the following qualifications:
    • If the internal audit department is prohibited by law or regulation from conformance with certain parts of the Standards, the Director of Internal Audit will ensure appropriate disclosures and will ensure conformance with all other parts of the Standards.

Quality Assurance and Improvement Program

The internal audit department will maintain a quality assurance and improvement program that covers all aspects of the internal audit department. The program will include an evaluation of the internal audit department’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 the internal audit department and identify opportunities for improvement.

The Director of Internal Audit will communicate to the Officer and the Committee on the internal audit department’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 team from outside the University.

[1] The Director of Internal Audit or equivalent title and position who manages the University Internal Audit function.

Approved by the University Audit & Risk Committee on February 22, 2018