no6 by liuqingyan


									 UC Internal Audit Orientation
       August 18, 2005

•Organizational Overview
   •Strategic Vision
        •Current Environment

      Patrick Reed
Organizational Overview

•Campus/Lab & OP based since
 decentralized in 1978
•132 auditor positions at 13 locations
•15 Audit Directors (Investigations & IT)
•Report to Regents via Dual Reporting
•Chancellor’s/Lab Director’s delegations
 have 3 conditions
•Local Management cannot unilaterally
 remove audit director
    Organizational Overview

Independence is essential to the effectiveness of the
Internal Audit Program. Independence is based
primarily upon organizational status and objectivity:

The University Auditor reports functionally to The
Regents’ through its Committee on Audit and
administratively to the Senior Vice President –
Business and Finance. The University Auditor also has
direct access to the President of the University.
             Organizational Chart
                        Comm. on Audit


        University              VC         Dept Lab    University
         Auditor            Budget/Admin   Directors    Auditor

                             Campus         Lab        UCOP
                              IAD’s        IAD’s        IAD
Dir of IT      Dir of
 Audits        Invest
                                UNIVERSITY AUDITOR
                                    Patrick V. Reed

   OFFICE OF THE                       CAMPUS/                      UC MANAGED
UNIVERSITY AUDITOR                      UCOP                       LABORATORIES

Investigations                   Berkeley                      Lawrence Berkeley
John Loshe, Director             Stephanie Siri, Director      Terry Hamilton, Director

IT Audits                        Davis                         Lawrence Livermore
Karl Heins, Director             Rick Catalano, Director       Paul Schafer, Director

                                Irvine                        Los Alamos
                                Marsha Murphy, Director       Terry Brendlinger, Director

                                 Los Angeles
                                 Edwin Pierce, Director

    San Diego                    Office of the President    Santa Barbara
    Stephanie Burke, Director    Helen Valness, Director    Wanda-Lynn Riley, Director

    San Francisco                Riverside                  Santa Cruz
    Abby Zubov, Director         Mike Jenson, Director      Geri Gail, Director
    Organizational Reporting
•   UCB - Robert Birgeneau, Chancellor
•   UCD - John Meyer, VC-Resource Mgmt. & Planning
•   UCI - Wendell Brase, VC-Bus & Admin Services
•   UCLA - Steve A. Olsen, VC-Finance & Budget
•   UCR - Gretchen S. Bolar, VC Academic Planning and Budget
•   UCSD - John Woods, VC-Resource Mgmt & Planning
•   UCSF - Steve Barclay, VC-Administration & Finance
•   UCSB - Donna Carpenter, Interim VC-Admin Services
•   UCSC - Tom Vani, VC-Business & Admin Services
•   UCOP - Patrick Reed, University Auditor
•   UAO - Joseph P. Mullinix, Sr. Vice President-Bus & Finance
•   LLNL - Michael R. Anastasio, Laboratory Director
•   LBNL - Steven Chu, Laboratory Director
•   LANL - Robert Kuckuck, Interim Laboratory Director
 Organizational Overview
Internal Audit Mission Statement –
         - revised March 2004
The mission of internal audit is to assess and monitor the
university community in the discharge of their oversight,
management, and operating responsibilities in relation to
governance processes, the systems of internal controls, and
compliance with laws, regulations and University policies
including those related to ethical conduct by providing relevant,
timely, independent, and objective assurance, advisory and
investigative services using a systematic, disciplined approach to
evaluate risk and improve the effectiveness of control and
governance processes.
Organizational Overview

Internal Audit Vision –

We advance the University of California’s
ability to achieve its mission by promoting a
culture of integrity and accountability.
Organizational Overview
Internal Audit Management Charter

Internal Audit functions under the
policies established by The Regents of
the University of California and by
University management under delegated
 Organizational Overview

The Internal Audit Departments report
administratively to the Chancellor or Laboratory
Director and functionally to The Regents’
Committee on Audit through the University
Auditor but have direct access to the President or
The Regents’ Committee on Audit as the
circumstances warrant.
Organizational Overview

  • Authorized to have full, free,
    unrestricted access to information
  • Includes computer files (subject to
    ECP), property, and personnel
  • Except where limited by law, IA access
    is unrestricted
      Organizational Overview—
           Profile of Internal Auditors

•   Average UC audit experience is 9 years
•   Average general audit experience is 17 years
•   99.2% possess undergraduate degrees
•   32% hold graduate degrees
•   155 certifications held by 86 auditors
    52 CPAs, 35 CIAs, 21 CFEs, 25 CISAs, 22 other
         Organizational Overview—Time
                  Actual FY 03/04 Hours

Average FTE’s             130      100%      1
Total Hours –Gross      277,550    100%    2,096
Vac, Holiday, Illness    47,643     17%     356
Controllable            229,907     83%    1,740

Less Admin. & Misc.      28,039      10%    209
Less Training            8,451       3%      63

Net Direct Audit Time 193,417       70%    1,468
         Organizational Overview—Time
                    Actual FY 03/04 Hours
Direct Time:          Hours       %     Ave Hrs     Ave # Prj

Audits               115,771     60%        881      2.56

Advisory Services     34,181     18%        264      1.82

Investigations        29,238     15%        220      1.78

Audit Support         14,227     7%         103        -

Total                193,417     100%       1,468     6.2
 Organizational Overview
Distribution of Actual FY 03-04 Hours (By Functional Area)
Organizational Overview—Time
7 Year Perspective on Distribution of Time
Organizational Overview—Time
7 Year + Planned Perspective on Distribution of Time
Organizational Overview—Time
       Plan FY 05/06 Hours

                   Staffing and Available Hours
                   We are projecting a substantial
                   increase in the percentage of
                   positions filled, and accordingly we
                   are able to project a 28,000 hour
                   increase in available resources. This
                   increase is also augmented by a
                   return to a more historically normal
                   level of non-controllable time for
                   holidays, vacations and illness, etc.
                   The slight decrease in budgeted
                   training hours for FY 2006 is due in
                   part to the biennial All Auditors
                   Conference, which was held in
                   February 2005. The budgeted
                   professional development level is
                   slightly less than our historical
                   training investment.
Organizational Overview—Time
       Plan FY 05/06 Hours

                             • With 37,000 hours budgeted
                             for advisory services, we
                             continue to participate in an
                             advisory capacity with new
                             systems developments,
                             policy development, other
                             critical initiatives and make
                             ourselves available for
                             routine informal consultation
                             with management and staff.

                             • We have planned an
                             increase in supplemental
                             (unallocated) audit hours and
                             advisory services in order to
                             have flexibility for changing
                             circumstances and in part to
                             buffer the aggressive staffing
Organizational Overview—Time
       Plan FY 05/06 Hours
       Strategic Vision

In addition to the Operating Plan,
there is always a Strategic Plan in
place to assure and guide the
efforts at continuous improvement
of the UC Internal Audit Program.
         Strategic Plan
Historical Accomplishments:
•Established Guidelines for the Dual Reporting
•Establishment of Operational Reporting consistency
 and enhanced Communications with Regents
•Risk assessment process and audit planning model
•Creation of systemwide audit manual
 establishing numerous standards
•Establishment of the Quality Assurance Program
•Developed a Skills Assessment processes
               Strategic Plan
Historical Accomplishments:
•Established Guidelines for local audit
•Audit Forums created to alternate with AAC
•Data warehouse and employee database
 enhancement of IT Audit Program
•Creation of Core Audit Program
•Strengthened Investigations Program,
 coordination and reporting
     Strategic Plan

August 2005 Retreat
•Audit Tracker
•Improving Internal Reporting
•Continuous Monitoring
•Improved client communications
•Corporate governance
Current Environment

•   Regents Audit Committee
• California Budget Crisis
• Code of Conduct/Ethics

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