Internal Auditing

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Submitted By SiewPeng
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Question 1

You are one of the internal auditors of Beeman Bhd., a public listed company.

(a) Narrate how you would deal with ‘Whistle blowing’ in the company.

(b) Explain the views of Institute of Internal Auditors on this whistle-blowing.

Answer

a) Internal auditor’s role regarding whistle blowing: • assure the employees that their complaints will be taken seriously by management

• develop policies relating to whistle blowing, and offer prompt and continuous responses to internal complaints.

• the role of senior management in following the organisation’s code of conduct.

• implementing and maintaining a good corporate compliance program.

• provide a proper internal channel for staff to report to the internal auditor

• Once an allegation has been made and an investigation is required, internal auditor will check whether the complaint is correct without causing undue damage or disruption to other people in the company.

• If the internal auditor has good working relationship with the employees, then a whistleblower would feel confident about calling the internal auditor to give their complaints.

b) The IIA on ‘Communicating Sensitive Information Within and Outside of the Chain of Command’ suggests that 'if the communication results in a conclusion that management, by its inadequate or lack of actions, is exposing the organisation to an unacceptable level of risk, the chief auditor should consider other options to achieve a satisfactory resolution.

However, the Advisory Note further stipulated that in observing the code of conduct on 'confidentiality', internal auditors should always seek legal counsel if the situation is sensitive and has significant consequences. Adequate assessment of the reasonableness of evidence must be properly carried out.

As far as professional standards are…...

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