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HomeMy WebLinkAboutCAO-2022-494 - 2023 Internal Audit Work Plan www.kitchener.ca REPORT TO: Audit Committee DATE OF MEETING: December 19, 2022 SUBMITTED BY: Corina Tasker, Internal Auditor, 519-741-2200 ext. 7361 PREPARED BY: Corina Tasker, Internal Auditor, 519-741-2200 ext. 7361 WARD(S) INVOLVED: All DATE OF REPORT: December 8, 2022 REPORT NO.: CAO-2022-494 SUBJECT: 2023 Internal Audit Work Plan RECOMMENDATION: That the 2023 Internal Audit work plan be approved as outlined in report CAO-2022- 494. REPORT HIGHLIGHTS: The purpose of this report is to outline the proposed assurance and consulting activities to be conducted by the Internal Auditor in 2023. The work plan consists of six assurance audits, two status updates, one consulting engagement. There are no financial implications. Community engagement included t agenda in advance of the council / committee meeting. This report supports the delivery of core services. BACKGROUND: Internal Audit Goal The overarching goal of internal audit is . This includes, but is not limited to, protecting the long-term health of the organization, its financial and physical assets, its reputation, its ability to perform critical services and the safety and well-being of employees and citizens. Internal Audit Services To fulfill the above goal, the internal auditor provides two types of service in accordance with the Institute of Internal Auditors definitions: Assurance services evidence to provide an independent opinion or conclusions regarding an entity, operation, function, process, system, or other subject matter; and www.kitchener.ca Consulting services which are advisory in nature and are generally performed at the specific request of an engagement client. When performing consulting services, the internal auditor should maintain objectivity and not assume management responsibility. Internal Audit Work plan The assurance services included on the internal audit work plan outlined in this report consists of topics that have been independently selected by the internal auditor. These topics fall broadly into one of three categories: 1) Physical assets such as physical inventory counts 2) Financial resources such as expense audits 3) Policy compliance such as hiring transparency This annual plan consists of compliance and controls audits, confidential investigations, and any other independent analysis as required. Standard assurance audit topics which are common to most organizations or other municipalities are included in a recurring 6-year plan. Other assurance topics are added as required related to emerging risks, tips, or other audit findings. The internal auditor will also provide consulting services related to process reviews, capacity analysis, organizational structure analysis, risk assessments and value for money analysis as the need arises. These services are provided to aid staff in continuous improvement in the design and delivery of City services. These types of reviews are requested by divisional management, or by Council through discussions with the CAO. Audit reports on each work plan item will be presented to Audit Committee as completed. REPORT: 2023 Internal Audit Work Plan Audit Committee is asked to approve the 2023 Internal Audit work plan shown below as per the Audit Committee terms of reference. Assurance Services: Carried over from 2022 Audit Topic Type of Audit Parking and Mileage Claims Compliance Technology Field Assets Physical Inventory Underground Locates Organizational structure / capacity analysis www.kitchener.ca New for 2023 Audit Topic Type of Audit Accounting Controls Petty Cash Controls Physical Inventory Count verification Hiring Transparency and Nepotism Status update and compliance testing Market Alcohol Inventory Status update Confidential Investigations As required Consulting Services: Topic Type of Analysis INS Training Documentation Process Review Definitions Capacity Analysis An analysis of current and future demand for service compared to resourcing capacity. Compliance audit - A test to determine if staff is following all rules, regulations and policies associated with the service. Confidential Investigations Investigating staff or public complaints about any alleged staff misconduct including, but not limited to, fraud, theft, or inappropriate behaviour. Controls audit - An analysis and test of control points within a process to ensure that fraudulent activity can be eliminated or mitigated. Count Verification Sampling physical inventory counts to verify the accuracy of staff physical inventory counts. Organizational Structure Analyzing organizational structure options to best support business objectives. Process review A review of process steps using Lean methodologies to eliminate waste and improve the process efficiency and effectiveness. Status update A check-in on the status of recommendations and benefits achieved from previous audits or reviews. STRATEGIC PLAN ALIGNMENT: This report supports the delivery of core services. FINANCIAL IMPLICATIONS: Capital Budget The recommendation has no impact on the Capital Budget. www.kitchener.ca Operating Budget The recommendation has no impact on the Operating Budget. COMMUNITY ENGAGEMENT: INFORM the council / committee meeting. PREVIOUS REPORTS/AUTHORITIES: There are no previous reports / authorities related to this matter. APPROVED BY: Dan Chapman, CAO ATTACHMENTS: none CAO-2022-494 2023 INTERNAL AUDIT WORK PLAN Internal Audit Goal through ensuring: Operations are as effective and efficient as possible Controls are adequate to protect assets from loss Compliance with policy, procedures, legislation Internal Audit Services Assurance ServicesConsulting Services Objective assessment of Advisory / facilitation evidenceservices Independently chosenRequested Controls, compliance, Improvement of design investigations, and delivery of City comprehensive reviewsservices 2023 Internal Audit Work Plan Assurance Services AuditTopicTypeofAudit ParkingandMileageClaims*Compliance TechnologyFieldAssets*PhysicalInventory UndergroundLocates*Organizationalstructure/ capacity AccountingControls PettyCashControls PhysicalInventoryCountverification HiringTransparencyandNepotismStatusupdateandcompliance Market Alcohol InventoryStatusupdate ConfidentialInvestigationsAsrequired * Carried over from 2022 2023 Internal Audit Work Plan Consulting Services TopicTypeofAnalysis INS Training DocumentationProcess and controls Other reviews as requestedTo be determined