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#55799 - 01/22/03 05:06 PM Internal Auditor
Anonymous
Unregistered

To whom should the Internal Auditor report to administratively? Board of Directors Audit Committee, CFO, CEO?

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Audit
#55800 - 01/22/03 05:13 PM Re: Internal Auditor
DawgFan Offline
Diamond Poster
DawgFan
Joined: Jul 2002
Posts: 1,678
United States
For administrative purposes, I report to the CFO. The ideal situation, of course, is to have IA report exclusively to the Audit Committee or The Board itself (if you don't have an AC), but I think someone has to be able to comment on what/how the Auditor does every day. For me, the CFO makes sure that I am on track with my calendar, and I give him a monthly report of my activities (this does not include giving him my audit reports, unless he is the subject of audit). He does not conduct audits with me, nor has he written any of my audit programs.
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Opinions expressed are solely my own.

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#55801 - 01/22/03 05:20 PM Re: Internal Auditor
Neytiri Offline
Platinum Poster
Neytiri
Joined: Jul 2002
Posts: 645
Pandora
Our CEO & President is technically my supervisor but I have other duties besides Audit. I report directly to the Audit Committee since theoretically am an employee of the Audit Committee not the bank.

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#55802 - 01/22/03 06:58 PM Re: Internal Auditor
RVFlyboy Offline
Power Poster
RVFlyboy
Joined: Oct 2000
Posts: 5,978
Soaring over Georgia
There really is not a definitive answer to your question. It's going to depend on corporate structure, and individual preference. As an internal auditor, I have reported administratively to the CFO, the COO, and the CEO at different times and in different banks. In my current bank, the internal auditor reports administratively to the Corporate Risk Manager.

What really matters is the independence of the position and that comes from having a direct reporting relationship to the Audit Committee.
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Jim Bedsole, CRCM, CBA, CFSA, CAFP
My posts - my opinions

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#55803 - 01/22/03 09:30 PM Re: Internal Auditor
LinMarie Offline
100 Club
LinMarie
Joined: Nov 2001
Posts: 243
I report to the CEO for day to day items but I ultimately work for the BOD. I report to them on a monthly basis and meet with them quarterly. I am also in direct contact with the Board on a regular basis.

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#55804 - 01/22/03 09:35 PM Re: Internal Auditor
Anonymous
Unregistered

I report to the BOD's audit committee, however, the CEO is the COB and heads the Audit Committee, so technically he is my supervisor for day-to-day oversight such as, 1) am I doing my job; 2) approval of time off; 3) internal support, etc.. Under the corporate structure, I work for the BOD. As long as I have been an IA, it has been this way. I agree with jbedsole's comment that the independence of the position is what is most important.
GG

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#55805 - 01/22/03 09:54 PM Re: Internal Auditor
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 79,290
Galveston, TX
To avoid conflicts of interest, your Audit Committee should only be composed of outside directors. Once your bank reaches $500MM, it's a requirement.
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The opinions expressed here should not be construed to be those of my employer: PPDocs.com

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#55806 - 01/23/03 04:39 AM Re: Internal Auditor
Deepa C Offline
Junior Member
Deepa C
Joined: Dec 2002
Posts: 27
Dubai, UAE
When I was an auditor, I reported to the Audit & Finance Committee of the BOD and to the CEO for administrative issues. The AFC got a monthly report from me and I had a quarterly meeting with them. The CEO was cc'd on all correspondence.

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#55807 - 01/23/03 03:51 PM Re: Internal Auditor
Walleye Woman Offline
Platinum Poster
Walleye Woman
Joined: Jul 2002
Posts: 832
I report to the audit committee which is comprised of outside directors. The bank president is my supervisor to the extent that he evaluates me on my day-to-day performance. The audit committee performs an evaulation also, concentrating on my audit work.
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Marilyn, CRCM

I'd rather be fishing.


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#55808 - 01/23/03 04:09 PM Re: Internal Auditor
Last Mango Offline
Gold Star
Joined: Mar 2001
Posts: 293
Too Far From the Beach
I report functionally to the Audit Committee. For administrative purposes, I report to the CEO. Although the CEO has no authority over my daily duties . . . he can make life miserable if need be. Personal leave, expenses etc have to be approved by the CEO. Reviews are performed by the Audit Committee through the board Personnel Committee. I strongly believe that the internal auditor should functionally report to an Audit Committee comprised of outside directors and for administrative purposes, the CEO. Having to conduct an audit on a function directly supervised or performed by the CFO is dangerous to an internal auditor’s health – if you know what I mean. And of course, an internal auditor should never report to line management.

Disclaimer: My opinion above is not intended as legal advice because I am not a lawyer. If I were, I would be charging for my thoughts at the rate of $300 per hour in additional to fees for phone calls, copies, faxes etc. etc. My ramblings are certainly not the opinion of my employer and, if you ask my wife, not worth 2˘.
_________________________
If you keep living straight from the heart, you will know when to stop and to start.

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#55809 - 02/21/03 11:23 PM Re: Internal Auditor
lakesider Offline
Member
Joined: Mar 2001
Posts: 73
bixby, OK
I report to the EVP of Operations for day to day activity but I ultimately report to the board.

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#55810 - 02/21/03 11:25 PM Re: Internal Auditor
lakesider Offline
Member
Joined: Mar 2001
Posts: 73
bixby, OK
I report to the EVP of Operations for day to day activity but I ultimately report to the board. [image]dgl.microsoft.com/mgolen/images/animedwnld.gif[/image]

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#55811 - 02/24/03 03:37 PM Re: Internal Auditor
jwr1996 Offline
100 Club
jwr1996
Joined: Jan 2003
Posts: 163
CEO administratively and BOD ultimately.

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#55812 - 02/24/03 04:06 PM Re: Internal Auditor
crystal2721 Offline
New Poster
crystal2721
Joined: Feb 2003
Posts: 24
Kentucky
My immediate supervisor is the CEO, but I report monthly to the board of directors. I am also the compliance officer, though so I am an employee of the bank.
_________________________
The opinions expressed here are my own and not necessarily that of my employer.

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