Internal Audit Charter
Internal auditing is an independent appraisal function established to examine and evaluate activities as a service to the Internal Audit Committee, the President, and senior management of U. T. Permian Basin. The auditors must have a high degree of independence and not be assigned duties or engage in any activities that they would normally be expected to review or appraise. Current editions of Standards for the Professional Practice of Internal Auditing issued by the Institute of Internal Auditors, College and University Business Administration issued by the National Association of College and University Business Officers, and the Texas Internal Auditing Act shall serve as guidelines for the Office's activities.
The Office of Internal Audit is a vital part of U.T. Permian Basin management and functions in accordance with the policies established by the President of The University of Texas of the Permian Basin, the Internal Audit Committee of The University of Texas of the Permian Basin, The University of Texas System, The Board of Regents of The University of Texas, and by the Legislature through the Texas Internal Auditing Act. The internal auditing services are reported directly to the President and to the Internal Audit Committee. The University of Texas of the Permian Basin Internal Audit Committee obtains, reviews and reports to the President on all institutional audit reports; approves the institutional internal audit plan; and transmits to the President such instructions as it deems necessary for the implementation of appropriate internal auditing practices.
The Office of Internal Audit is responsible for providing the President and senior management with information about the adequacy and effectiveness of The University of Texas of the Permian Basin's system of internal administrative and accounting controls and the quality of operating performance when compared with established standards, and for recommending alternatives and modifications to existing systems and operations to improve overall efficiency and effectiveness. To accomplish these objectives the Office of Internal Audit is authorized to have full, free, and unrestricted access to all functions, property, personnel, and records (including medical and electronic). Although such access will be unlimited, the Office of Internal Audit shall ensure the safekeeping and confidentiality of all records and information.
Internal Audit Committee Statement of Responsibility
One of the most significant areas of organizational governance is the audit committee. These are the major assumptions and processes of that committee:
The single most important finding, and the key to audit committee effectiveness is background information and training. Management and internal auditors are identified as sources of this information. Special sessions on internal controls and the impact of their effectiveness on the committee's oversight responsibilities would acquaint committee members with the control environment. The internal auditor should report to the committee regularly regarding weaknesses noted in internal control.
To enhance the effectiveness of the meeting, briefing materials should be supplied to the committee well in advance, and committee members should take adequate time to review them.
State-of-the-art audit committees meet at least quarterly.
The audit committee should review with management their assessment of the external and internal risks and whether or not the risk factors are being reasonably addressed. In addition, they should determine how internal auditing considers these risks when establishing the scope of their respective audits.
The audit committee should advise the Director of Internal Audit that committee members expect to be advised of any areas requiring their special attention.
The Director of Internal Audit should report the results of the department's auditing activities to the committee. Under normal circumstances, summary reporting should be made; however, specific findings and recommendations related to significant matters should be reported.
The audit committee must be satisfied that internal auditing maintains its independence and objectivity. The committee should be satisfied that internal auditing is organizationally independent by ensuring the director reports to an appropriate executive level within the organization.
The committee should be satisfied that the department's staffing and budget are adequate to enable the department to effectively perform its responsibilities.
The Office of Internal Audit shall establish and maintain a program of quality assurance designed to evaluate the operations of the department. The purpose of this program is to provide reasonable assurance that all work performed by the department conforms to the guidelines under which the department operates. This program should include training, supervision, and internal and external reviews. Internal reviews should be performed by members of the department on a routine basis to appraise the quality of work performed. External reviews of the department should be performed every three years, as required by the Texas Internal Auditing Act, by qualified persons who are independent of the Office of Internal Audit.