IIA Today - March 2010

Today A MESSAGE FROM THE INSTITUTE OF INTERNAL AUDITORS

IIA MEMBERSHIP A TAILORED FIT

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March 2010

Updates from The IIA and the Internal Audit Profession Make Your IIA Membership a Tailored Fit April and May Training Opportunities from The IIA Recruit-A-Colleague Program for You

Big decisions follow you around.

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Audit • Tax • Advisory

WELCOME MESSAGE

Today PUBLICATION DIRECTOR

Melissa Calhoun EDITOR

Ross Schmadebeck STAFF EDITORS

Allison Cain Lisa Krist Joe White CONTRIBUTING EDITORS

Margo Baeta ART DIRECTOR

Jon Peters PRODUCTION MANAGER

Lori Shewack

Dear Fellow Members, Since coming to the helm of The IIA as president and CEO, I have felt an immense sense of pride and responsibility in leading an organization rich in history, diversity, and stature. But it is also my many years of experience in this profession, and the time I have spent as an IIA volunteer leader, that have helped me understand the value and benefits of IIA membership.

I joined The IIA years ago because it provided a great source of networking, professional development, and access to IIA guidance and publications such as the award-winning Internal Auditor magazine. Even at that time, I considered my affiliation with The IIA a tremendous asset. But as I became more engaged with the organization, I realized that IIA membership meant more than these obvious benefits. By being an IIA member, I have: ■■ Enhanced my leadership skills and expanded my network of colleagues

by volunteering on national and international committees and boards.

■■ Demonstrated my knowledge and expertise while enhancing my cred-

IIA PRESIDENT AND CEO

Richard F. Chambers, CIA, CCSA, CGAP IIA CHAIRMAN OF THE BOARD

Roderick M. Winters, CIA

ibility and marketability as a professional by obtaining IIA certifications.

■■ Gained respect and recognition from my peers by sharing my

professional experiences as an IIA speaker.

■■ Shaped the future of the internal audit profession and how it’s

practiced by contributing to The IIA’s Standards-setting process.

IIA Today is a bimonthly publication produced exclusive for members of The IIA. To learn more about this publication, please visit www.theiia.org/IIAToday.

We welcome all comments, questions, and feedback. Please send your message to IIAToday@theiia.org and include your name and contact information.

■■ Helped develop and enhance world-class internal audit activities

throughout the world by contributing to The IIA Research Foundation.

■■ Enjoyed exchanging ideas and knowledge by participating in the

close-knit community of my local chapter.

IIA membership has meant so much to me during my career as an internal auditor. The opportunities above are just a few of the ways you, too, can embrace your IIA membership experience. The possibilities are endless, and I challenge you in 2010 to make IIA membership mean more.

Sincerely,

The Institute of Internal Auditors

247 Maitland Ave. Altamonte Springs, FL 32701 USA +1-407-937-1100 www.theiia.org All contents copyright © The Institute of Internal Auditors (IIA) 2010.

Richard F. Chambers, CIA, CGAP, CCSA President and Chief Executive Officer The Institute of Internal Auditors

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NEWS

IIA RELEASES FLASH ALERT ON SEC DISCLOSURES In response to new proxy disclosure rules issued by the U.S. Securities and Exchange Commission (SEC), The IIA Audit Executive Center has released a Flash Alert providing immediate guidance to chief audit executives about the impact of the new requirements effective February 28, 2010.

“As I have traveled and spoken with CAEs and participated in IIA roundtables over the past month, it has been clear that this is the number one topic on the minds of most CAEs of publicly traded companies,” says IIA president and CEO Richard Chambers . “The new proxy requirements will place greater pressure on boards to demonstrate their role in the oversight of risk management. And by extension, this presents both challenges and opportunities for CAEs and their internal audit teams.”

For complete details on the Flash Alert, including resources available from the SEC, visit www.theiia.org and click on “Latest News.”

IIA ADVOCATES FOR INTERNAL AUDITORS TO CONDUCT ANNUAL PCI DSS COMPLIANCE ASSESSMENTS After the Payment Card Industry Security Standards Council (PCI SSC) updated Data Security Standards (DSS) in late 2008, MasterCard Worldwide issued a notification to its members in June 2009 that required “Level 1” and “Level 2” merchant validations of PCI DSS compliance to be completed by certified Quality Security Assessors. These assessors are trained and credentialed by the PCI SSC, and internal auditors would not 4

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have been able to participate in PSC DSS compliance validation because the certification program has not been available to internal auditors.

In response, The IIA emphasized in a September 2009 letter to MasterCard Worldwide the “independence, objectivity, competency and accountability of internal auditors that well positions them to conduct PCI DSS annual compliance assessments.” As a result, MasterCard requested that the PCI DSS certify internal auditors so they may conduct the required PCI DSS annual assessments. Then in December 2009, MasterCard notified its merchants that effective June 30, 2011, Level 1 merchants may use internal auditors who have obtained

PCI SSC-offered training and certification to conduct their annual onsite DSS compliance assessments since the PCI SSC now intends to offer their training accreditation to internal auditors in 2010.

“MasterCard’s announcement means that internal auditors now will have the opportunity to expand and document their knowledge of information security through the PCI SCC certification program,” says Richard Chambers, president and CEO of The IIA. “This will pave the way for merchants around the world to tap into the skills and experience of their internal auditors to assess compliance with the PCI standards that guide the credit card industry.”

NEWS

NEW IIA FELLOWSHIP PROGRAM LAUNCHED The IIA is excited to announce the first fellow as part of its new IIA Fellowship program. Derek Butler, manager, enterprise risk services for Deloitte & Touche LLP, started his six-month fellowship on February 9 and will contribute to The IIA’s Audit Executive Center.

50TH ANNIVERSARY OF CHICAGO CHAPTER ANNUAL EVENT The IIA’s Chicago Chapter is proud to present its 50th Annual Seminar.

The one-day event draws more than 1,000 internal audit professionals from the Chicago area and beyond to take part in three keynote sessions and four concurrent sessions, with 32 sessions to chose from covering eight tracks.

“Those joining us for our 50th Annual Seminar and celebration should expect a full, interactive day of training provided by more than 30 of today’s premier internal audit and business

DON’T FORGET TO…

professionals,” says Chicago Chapter President Justin Naples.

“Everyone should be prepared to take away a wealth of new knowledge and best practices. In addition to the training opportunities, participants should use the networking opportunities at both our early morning career fair, as well as our post-seminar 50th anniversary celebration.”

The IIA is proud to recognize the Chicago Chapter and its members for the continued support of the internal audit profession.

For more information about this highly popular annual event, please visit www.theiia.org/Chicago.

Participate in The IIA International Standards for the Professional Practices of Internal Audit exposure draft. The exposure draft window closes on May 15, 2010. Visit www.theiia.org/Guidance for more information.

Butler brings with him more than 15 years of internal audit, accounting, and regulatory experience. He has worked closely with a number of internal audit groups primarily in the financial services, insurance, and healthcare industries. He has been a member of The IIA since 2003 and is currently an active member of the Baltimore Chapter.

“I hope to learn more about The IIA and how it helps support our local chapters and members while working with the organization’s team of talented individuals to develop and enhance new products and services,” says Butler.

For more information about The IIA’s Fellowship Program, visit www.theiia.org/Careers.

Complete the Global Internal Audit Survey available beginning March 15, 2010. The survey will be available until May 17, 2010, and is available in 22 languages.

Visit www.theiia.org/Global-Survey to complete the survey.

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FEATURE STORY

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FEATURE STORY

MAKE YOUR IIA MEMBERSHIP A TAILORED FIT As an IIA member, you already enjoy many of the benefits of being part of The Institute of Internal Auditors. Maybe you look forward to receiving Internal Auditor magazine and you used your member discount to register for an IIA seminar or conference. That’s a smart move because those benefits alone make your membership worth the cost, but did you know The IIA has so much more to offer you? Could you be missing out on important advantages and opportunities? Let’s make your IIA membership a tailored fit!

The IIA is not a “one-size-fits-all” organization. In fact, The IIA Membership Team works hard to help each individual advance their career with specific tools, training, and networking appropriate for them. They understand that while members appreciate the significance of being an integral part of a greater whole, individual needs must be met. So while the benefits are universal, their applications can be very personal.

Continued, page 8

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170,000 IIA MEMBERS FROM AROUND THE WORLD

MEMBER PUBLICATIONS AND THE IIA WEB SITE

IIA members are a diverse group of more than 170,000 professionals from more than 165 different countries and territories. Members work in internal audit and various internal audit related fields such as: accounting, information technology audit, risk management, governance, internal control and security. They are equally male or female and can be students, young professionals, middle management, experienced CAEs, powerful CFOs and CEOs, and everything in-between. “Our members are an extraordinarily talented and educated group of professionals,” says Richard Chambers, president and CEO at The IIA. “They know that IIA membership is a valuable asset that gives them a competitive edge in the local and global workplace.”

Let’s take a look at some of the most popular benefits of IIA membership, starting with Internal Auditor magazine. This bimonthly “global perspective on risk, control, and governance” is included for all North American members as a hard copy subscription, and is also available online at www.InternalAuditorOnline.org.

This new site was launched in 2009 and features more than 300 articles, including Web-exclusive content from the magazine’s popular Fraud Findings, Ask the Experts, and Back to Basics departments. There are also daily news updates, blogs from internal audit leaders and industryspecific content.

Other important member publications include online newsletters for the Specialty Industry Groups and

the new IIA Today. The IIA Today publication is delivered to North American members in both print and electronic formats. Its goal is to provide useful and timely information on internal audit news, guidance, research and professional development from The IIA. These publications are available through the newly updated IIA Web site home page, www.theiia.org.

ADVOCACY AND RESEARCH The IIA is the internal audit profession’s global voice as its acknowledged leader, chief advocate, and respected resource. Advocacy is defined by The IIA as “instilling pride in the internal audit profession, encouraging change and building relationships with organizations and stakeholders that impact the profession.” All members benefit from the promotion of internal auditing in their organizations and on a global scale. The IIA Research Foundation (IIARF) and IIARF Bookstore continue to provide valuable research tools, guides, and educational products that provide members with insight into emerging issues and trends.

Many of these materials are either available for free to members or at special members-only discounts.

TRAINING AND CERTIFICATION There are numerous opportunities for IIA members at all phases in their internal audit and internal audit related careers to build a solid professional framework through training and certification at The IIA. Practitioners need to distinguish themselves and become irreplaceable in their organizations in order to succeed. The IIA 8

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Did You Know …

In addition to the training provided by IIA headquarters, many of the local chapters provide their own professional development opportunities. In the 2008-2009 chapter year, IIA chapters offered a total of 9,541 CPE hours, with an average of 66.3 CPEs per chapter. Membership means more CPEs with access to more events in your local area.

provides training through seminars, conferences, on-site training, e-learning, webinars, The IIA’s CIA Learning System™, and executive development.

Members enjoy substantial discounts while earning continuing professional education (CPE) credits for designations such as the Certified Internal Auditor® (CIA®).

Additionally, members should stay tuned for upcoming information about members-only Webinars and additional CPE opportunities available in the coming months.

Larry Harrington, vice president, internal audit, Raytheon Company, is the incoming Sr. Vice Chair of The IIA’s North American Board and the Co-Chair of The IIA’s 2012 Boston International Conference Host Conference Committee. This longtime IIA member, volunteer, and educator will be a general session speaker at The IIA’s 2010 General Audit Management (GAM) conference and will present a concurrent session at the The IIA’s 2010 Atlanta International Conference.

my experience, IIA membership is powerful and inexpensive relative to its benefits.”

NETWORKING AND VOLUNTEERING Many IIA members consider networking and volunteering to be their most rewarding benefit. They enjoy being part of a global organization that allows them to participate at many different levels. The IIA’s motto is “knowledge through sharing” and members thrive on the enrichment that member contacts allow them.

Members can network through local, regional, national and international meetings, seminars, and conferences. They can also find networking resources on The IIA’s Web site. IIA volunteers have the opportunity to impact and promote the profession in a variety of ways. Future volunteers should check with their local chapters, institutes or on The IIA’s Web

site for ways to become involved. It is an excellent way to make a difference and help shape internal auditing.

“The only way things will change is if people get involved to make that change happen,” says Harrington.

“Your involvement can be as simple as your local chapter or as broad as the whole world.”

TAILOR YOUR IIA MEMBERSHIP Just like no two IIA members are the same; their membership experience should reflect their individuality and unique experiences. Tailoring your IIA membership so that it fits your needs and expectations is the best way to fully benefit from all that The IIA has to offer you. Terri Freeman, internal audit director, The IIA, was a dedicated IIA member even before she joined IIA Global Headquarters as a staff member. Her thoughts sum up what the Membership Team strives to achieve for every member, whether they are an internal audit practitioner or internal audit-related professional. “Without the guidance provided from The IIA through Standards, publications, training, etc., I would not be able to do my job well,” says Freeman. “My IIA membership helps me be the best internal auditor I can be.”

“You are responsible for your own education and your own career,” Harrington advises. “Don’t rely on your company to invest in you. Your career should be your own investment. In w w w. t h e i i a . o r g

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APRIL2010

CALENDAR

1 / Webinar

Auditing Application Security Visit www.theiia.org/E-learning for details.

5, 7, 9, 12, 14, 16 / Virtual Seminar Operational Auditing (OA): An Introduction

This online, instructor-led course reviews basic auditing and control concepts and helps you improve processes and position your organization to better achieve its objectives.

8 / Webinar

Treading into International Waters: What Fraud Risks Lurk Beneath the Surface of Your Foreign Affiliates Visit www.theiia.org/E-learning for details.

13 – 16 / Seminars San Francisco, CA, USA

Join your colleagues in San Francisco for our most popular courses including Beginning Auditor Tools and Techniques, Auditor-in-Charge Tools and Techniques, and more.

15 / Webinar

Ethics in an Organization: Considerations for Internal Audit Visit www.theiia.org/E-learning for details.

19 – 21 / 12th Annual Gaming Conference Las Vegas, NV, USA

The Gaming Conference brings together auditors, compliance officers, regulators, and professionals from land- and water-based gaming sectors who want to gain new perspectives, share best practices, and network with colleagues.

19 – 22 / Auditing JD Edwards (IIA/Deloitte) / Costa Mesa (Los Angeles), CA, USA

IIA Members: Register by March 19 to save an additional 10% off already reduced member pricing.

This seminar will help you acquire baseline knowledge of the JD Edwards modules and learn how to increase the effectiveness of financial and operational audits in a JD Edwards environment.

19, 21, 23, 26, 28, 30 / Virtual Seminar Value Added Business Controls: The Right Way to Manage Risk

Concentrating on “real-world” knowledge and experience, this highly interactive online seminar will help you use controls to detect and prevent fraud, design cost-effective control systems, and analyze existing control systems.

26 – 29 / Introduction to Auditing SAP ERP (IIA/Deloitte) / Dallas, TX, USA

IIA Members: Register by March 12 to save an additional 10% off already reduced member pricing.

This course provides an essential knowledge base as well as hands-on training for auditors working in an SAP ERP environment.

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3, 5, 7, 10, 12, 14 / Virtual Seminar Enterprise Risk Management (ERM): An Introduction

Through case studies, group discussions, and practical exercises, you will improve your understanding of ERM and the COSO ERM Framework, while getting up-to-speed with current issues, challenges, and emerging practices regarding GRC processes.

4 – 7 / Seminars Chicago, IL, USA

IIA Members: Register by March 23 to save an additional 10% off already reduced member pricing. You and your colleagues will benefit from course offerings including COSO-based Internal Auditing, Effective Writing for Auditors, Introduction to IT Auditing (IIA/Deloitte), and Operational Auditing: An Introduction Through Advanced.

6 / Webinar

Audits for Service Providers Yield Significant Results Visit www.theiia.org/E-learning for details.

10 – 13 / Auditing Oracle Applications (IIA/Deloitte) / Boston, MA, USA

IIA Members: Register by March 26 to save an additional 10% off already reduced member pricing.

This seminar will help you identify ways to provide an effective and efficient audit in an Oracle applications environment as well as how to audit Oracle applications security.

13 / Webinar

Royalty Compliance: Licensing Reporting Risk Areas

MAY2010

CALENDAR

Visit www.theiia.org/E-learning for details.

17, 19, 21, 24, 26, 28 / Virtual Seminar Operational Auditing (OA): Advanced

If you have more than three years of OA experience, you will benefit from this online, instructorled, hands-on event that shares real-world techniques that can improve the controls in your organization.

20 / Webinar

Uncovering Vendor Fraud and Theft Visit www.theiia.org/E-learning for details.

24 – 27 / Seminars Orlando, FL, USA

IIA Members: Register by April 9 to save an additional 10% off already reduced member pricing.

One of most popular seminar destinations features nine courses including our popular Tools and Techniques, CSA, and COSO classes and a new offering on Assessing Your Organization’s Risk Management Process.

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YOU’VE GOT QUESTIONS… HERE’S WHERE TO FIND THE ANSWERS! IIA members face new and ongoing challenges in 2010 as a result of the many changes in both the business world and the internal audit profession. Questions being heard around the world about how to meet these challenges include: ■■ How will The IIA’s newly issued International

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Professional Practices Framework (IPPF) impact my internal audit function?

Our board members are asking more questions about risk. Does my internal audit function have answers to those questions?

With information technology getting increasingly complex, how do we know that we’re appropriately considering key IT risks as part of our audit plan?

Difficult times increase the risk of fraud. Are we doing enough to prevent and detect fraud?

With all of these changes, do our internal audit practices align with The IIA’s quality assurance standards?

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FEATURE STORY

You can find all of the answers to these and other questions in one convenient source: the recently released Internal Auditing: Assurance & Consulting Services, 2nd Edition. This premier international textbook, published

by The IIA Research Foundation, answers the questions being asked by internal auditors worldwide.

HERE ARE JUST A FEW EXAMPLES: CHAPTER 2 Includes the IPPF, providing insights on both the mandatory and strongly recommended guidance.

CHAPTER 4 Includes risk management, ranging from the role and expectations of the board to the different roles internal auditing should and should not play relative to risk management.

CHAPTER 7 Covers IT governance, risk management, and control policies and procedures needed to effectively mitigate IT risks.

CHAPTER 8 Discusses the fraud prevention and detection practices that are outlined in Managing the Business Risk of Fraud: a Practical Guide, which was co-developed by The IIA, AICPA, and ACFE. CHAPTER 9 Describes the necessary procedures an internal audit function must perform to ensure an appropriate level of quality and outlines how to demonstrate that quality.

All this and more in a single textbook! As a valued IIA member, you save US $30 off the retail price of Internal Auditing: Assurance & Consulting Services, 2nd Edition.

Visit www.theiia.org/Bookstore to purchase your copy today!

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NEW INITIATIVE

RECRUIT YOUR COLLEAGUES… REWARD YOURSELF! The IIA is proud to have so many members that are truly passionate and dedicated to their profession.

Each day, IIA members are getting more involved with their local chapters and with The IIA, all with one common goal; to advance the profession of internal auditing.

In 2009, The IIA announced one more way for our members to get involved in growing the profession and The IIA: the Recruit-AColleague program. Much of The IIA’s phenomenal growth over the years is attributable to members, such as you, through word-of-mouth and peer-to-peer networking. The 14

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Recruit-A-Colleague program is designed to recognize members who truly advocate IIA membership at the highest level; inviting their peers and colleagues to join.

The Recruit-A-Colleague program is a year-long initiative, with quarterly recognition. For each new member you successfully recruit, you will be entered into a quarterly drawing to win valuable prizes from The IIA, such as complimentary conference or seminar registration, IIARF Bookstore bundles, e-learning opportunities, and much more. If you recruit 10 or more new members within the program year (October 1 through

September 30), your next IIA Membership renewal is FREE! We’ve developed a recruitment kit with the tools and resources including tips for successful recruiting, a complete listing of membership benefits, application forms, sample e-mail templates to send to your colleagues, and more.

Visit www.theiia.org/Recruit to learn more about this exciting program and Recruit-A-Colleague today!

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