Chapter 8 - Internal Audits Flashcards
What are the two types of Internal Audit
Company and Departmental Audit
What is an internal audit
done by internal audit committee and examines the overall activity of the company
What is a departmental audit
a technical audit that is done by selected members for department head - usually called underwriting review
Which departments can the internal audit committee help
accounting auditing finance internal control compliance measures
What is the responsibility of the Internal Audit Committee
Oversee integrity of company financial statements
measuring the effectiveness and efficiency of internal processes
ensures company complies with all regulatory and legal requirements
It is usual that the Interal department reports to the Internal audit committee and senior management
What is the focus on internal controls?
reviews administrative, operational and accounting controls, of the insurer
List some internal controls that can be in place
Do controls work properly
Do controls cover all the risks
are supervisory passwords secured?
have controls been put in place to restrict underwriters going beyond their underwriting level
What is the audit review
Abuse of expense accounts approval of charitable donations audit of public services approval of public communications security of computer systems audit of service providers
Explain to me what departmental audits do?
these audits are done by personnel from head office
this is a technical audit done by underwriters
foreign owned insurers usually have the corporate head office to do an audit on the Canadian biz to ensure:
more familiar with Canadian biz, check compliance with federal, provincial and territorial regulations
What is use of Audits
Identify Negative trends early and resolve them
Manage book better - compare actual with planned
Identify Performers
Training to improve underwriting
