Dave Richards CIA CPA Director Internal Auditing First

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Dave Richards, CIA, CPA Director, Internal Auditing First. Energy Corporation

Dave Richards, CIA, CPA Director, Internal Auditing First. Energy Corporation

Annual Certification of Internal Controls The Internal Audit Department’s Role The Institute of Internal

Annual Certification of Internal Controls The Internal Audit Department’s Role The Institute of Internal Auditors Webcast Series on Sarbanes-Oxley Session #2 - March 3, 2003

The Webcast Series on Sarbanes -Oxley’s Impact on Internal Auditing • January 28 -

The Webcast Series on Sarbanes -Oxley’s Impact on Internal Auditing • January 28 - Disclosure Controls - Available in online archive and on CD Rom • March 3 - Annual Certification of Internal Controls • April 1 - Coordination of Internal & External Audit Work • April 15 - Looking Ahead to Future Changes Impacting Internal Auditing • Tuesdays from 1: 00 - 2: 30 p. m. EST

Agenda 1: 00 - 1: 10 Introduction & Overview of Annual Certification of Controls

Agenda 1: 00 - 1: 10 Introduction & Overview of Annual Certification of Controls - Dave Richards 1: 10 - 1: 17 Methodology - Sheryl Hildebrand 1: 17 - 1: 24 Testing the Controls - Gary Mc. Guire 1: 24 - 1: 30 FDIC Certification Experience - Brian Szabo 1: 30 - 1: 45 External Auditor Attestation - Gary Stauffer 1: 45 - 1: 50 Break 1: 50 - 2: 25 Questions & Answers - Panel 2: 25 - 2: 30 Concluding Remarks - Dave Richards

Requirements (proposed) • Statement of Management’s Responsibilities (establishing & maintaining) • An assessment, at

Requirements (proposed) • Statement of Management’s Responsibilities (establishing & maintaining) • An assessment, at end of the most recent fiscal year – Effectiveness of internal controls – Procedures for financial reporting – Reporting to audit committee & external auditor any significant deficiencies and material weaknesses in the design or operation of internal controls • External auditor attestation

Internal Controls ? ? ? “A Process, Effected by an Entity’s Board of Directors,

Internal Controls ? ? ? “A Process, Effected by an Entity’s Board of Directors, Management and Other Personnel, Designed to Provide Reasonable Assurance Regarding the Achievement of Objectives in the Following Categories: – Effectiveness & Efficiency of Operations – Reliability of Financial Reporting – Compliance with Applicable Laws and Regulations. ” Source: COSO

Control Components Used to evaluate overall company’s accomplishment of objectives and specific processes’ performance:

Control Components Used to evaluate overall company’s accomplishment of objectives and specific processes’ performance: • • • Control environment Risk assessment Control activities Information and communications Monitoring

Management’s Assessment Process designed to provide reasonable assurance: • Transactions properly authorized • Access

Management’s Assessment Process designed to provide reasonable assurance: • Transactions properly authorized • Access to assets controlled against unauthorized or improper use • Transactions recorded to – Permit preparation of FS (GAAP) – Maintain accountability of assets • Controls in place to ensure proper reporting for external purposes

Issues • Definition of internal controls? – Financial – Operational – Compliance • What

Issues • Definition of internal controls? – Financial – Operational – Compliance • What is the level of internal control documentation needed? • How to test & evaluation criteria? • Process or organizational driven? • Requirements for attestation?

Material Weakness • Impact of control structure on preventing – Errors – Fraud •

Material Weakness • Impact of control structure on preventing – Errors – Fraud • Not detected in – Timely manner – Normal course of work • Material impact on financial statements – Material = influence decisions made based on financial information

Agenda 1: 00 - 1: 10 Introduction & Overview of Annual Certification of Controls

Agenda 1: 00 - 1: 10 Introduction & Overview of Annual Certification of Controls - Dave Richards 1: 10 - 1: 17 Documentation Tools - Sheryl Hildebrand 1: 17 - 1: 24 Testing the Controls - Gary Mc. Guire 1: 24 - 1: 30 FDIC Certification Experience - Brian Szabo 1: 30 - 1: 45 External Auditor Attestation - Gary Stauffer 1: 45 - 1: 50 Break 1: 50 - 2: 25 Questions & Answers - Panel 2: 25 - 2: 30 Concluding Remarks - Dave Richards

Agenda 1: 00 - 1: 10 Introduction & Overview of Annual Certification of Controls

Agenda 1: 00 - 1: 10 Introduction & Overview of Annual Certification of Controls - Dave Richards 1: 10 - 1: 17 Methodology - Sheryl Hildebrand 1: 17 - 1: 24 Testing the Controls - Gary Mc. Guire 1: 24 - 1: 30 FDIC Certification Experience - Brian Szabo 1: 30 - 1: 45 External Auditor Attestation - Gary Stauffer 1: 45 - 1: 50 Break 1: 50 - 2: 25 Questions & Answers - Panel 2: 25 - 2: 30 Concluding Remarks - Dave Richards

Agenda 1: 00 - 1: 10 Introduction & Overview of Annual Certification of Controls

Agenda 1: 00 - 1: 10 Introduction & Overview of Annual Certification of Controls - Dave Richards 1: 10 - 1: 17 Methodology - Sheryl Hildebrand 1: 17 - 1: 24 Testing the Controls - Gary Mc. Guire 1: 24 - 1: 30 FDIC Certification Experience - Brian Szabo 1: 30 - 1: 45 External Auditor Attestation - Gary Stauffer 1: 45 - 1: 50 Break 1: 50 - 2: 25 Questions & Answers - Panel 2: 25 - 2: 30 Concluding Remarks - Dave Richards

Agenda 1: 00 - 1: 10 Introduction & Overview of Annual Certification of Controls

Agenda 1: 00 - 1: 10 Introduction & Overview of Annual Certification of Controls - Dave Richards 1: 10 - 1: 17 Methodology - Sheryl Hildebrand 1: 17 - 1: 24 Testing the Controls - Gary Mc. Guire 1: 24 - 1: 30 FDIC Certification Experience - Brian Szabo 1: 30 - 1: 45 External Auditor Attestation - Gary Stauffer 1: 45 - 1: 50 Break 1: 50 - 2: 25 Questions & Answers - Panel 2: 25 - 2: 30 Concluding Remarks - Dave Richards

Agenda 1: 00 - 1: 10 Introduction & Overview of Annual Certification of Controls

Agenda 1: 00 - 1: 10 Introduction & Overview of Annual Certification of Controls - Dave Richards 1: 10 - 1: 17 Methodology - Sheryl Hildebrand 1: 17 - 1: 24 Testing the Controls - Gary Mc. Guire 1: 24 - 1: 30 FDIC Certification Experience - Brian Szabo 1: 30 - 1: 45 External Auditor Attestation - Gary Stauffer 1: 45 - 1: 50 Break 1: 50 - 2: 25 Questions & Answers - Panel 2: 25 - 2: 30 Concluding Remarks - Dave Richards

Dave Richards CIA CPA Director Internal Auditing FirstDave Richards CIA CPA Director Internal Auditing First
Dave Richards CIA CPA Director Internal Auditing FirstDave Richards CIA CPA Director Internal Auditing First
SOU Internal Auditing By Ryan Schnobrich CPA CIASOU Internal Auditing By Ryan Schnobrich CPA CIA
SOU Internal Auditing By Ryan Schnobrich CPA CIASOU Internal Auditing By Ryan Schnobrich CPA CIA
SOU Internal Auditing By Ryan Schnobrich CPA CIASOU Internal Auditing By Ryan Schnobrich CPA CIA
MODUL1 INTERNAL AUDITING THE NATURE OF INTERNAL AUDITINGMODUL1 INTERNAL AUDITING THE NATURE OF INTERNAL AUDITING
Value of Internal Auditing Internal Auditing Assurance InsightValue of Internal Auditing Internal Auditing Assurance Insight
Internal Auditing BY CDR ALOK MOHAN Internal auditingInternal Auditing BY CDR ALOK MOHAN Internal auditing
AUDITING 10 1 Auditing AAAs Definition Auditing isAUDITING 10 1 Auditing AAAs Definition Auditing is
ETHICS IN AUDITING AUDITING FUNCTION Ethics in AuditingETHICS IN AUDITING AUDITING FUNCTION Ethics in Auditing
Internal Auditing Issues Raheel Qureshi CPA Tara PritchettInternal Auditing Issues Raheel Qureshi CPA Tara Pritchett
Internal Tides Internal Tides Internal Tides are InternalInternal Tides Internal Tides Internal Tides are Internal
esercizio Internal Internal Internal Disponibile nelle dispense Internalesercizio Internal Internal Internal Disponibile nelle dispense Internal
Internal and Governmental Financial Auditing and Operational AuditingInternal and Governmental Financial Auditing and Operational Auditing