AGIA and IIAP: Strengthening Partnerships

"AGIA: Kaagapay sa Pagsulong ng Tunay na Pagbabago“

Annual National Convention
Puerto Princesa City
13 October 2016
The partnership
Signed November 2015

1. Briefing on the state of internal audit Internal auditors from

NGAs, GOCCs, GFIs,
to facilitate understanding of SUCs and LGUs. It’s
principles, standards and primary objective is to
promote the development
frameworks. of its members toward a
2. Support advocacy for strong internal strengthened internal
audit service which will
auditing in the public sector. ensure:

quality service delivery
3. Provide trainers on topics related to and
practice of internal auditing.
efficient and effective
utilization of state
resources.

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The Institute of Internal Auditors
The IIA is the internal audit profession's global voice, recognized authority,
acknowledged leader, chief advocate, and principal educator.

1941 IIA, Inc. was established in New York

1948 IIA – Manila Chapter was organized on 14 Aug
3rd chapter of IIA, Inc.
1990 Earned ‘Institute’ status
2016 Theme: “Embrace and lead change”

Competency Industry

The only globally accepted designation for internal auditors and the standard by which
individuals demonstrate their professionalism in internal auditing.
1. Our internal audit journey
The IIA is the internal audit profession's global voice, recognized authority,
acknowledged leader, chief advocate, and principal educator.

Members 2,561 Professionals

involved in
1,656 internal audit,
governance,
risk, control and
1,133 compliance,
academe and
government,
fraud and IT.
Certified 378
Internal
Auditor
(CIA) 14

Year 73 85 94 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15

Golden harvest Rank To-date Certified professionals To-date

Gold (Global topnotcher) Top 1 4 CGAP 1 Certified
Silver Top 2 1 CCSA 56 Government
Audit
Certificate of excellence Top 10 15 CFSA 62 Professional
Certificate of honor Top 50 46 CRMA 87 (CGAP)
CIA (as of 10 Oct 2016) 1,678
Mission of internal audit

To enhance and protect organizational

value by providing risk-based and
objective assurance, advice and
insight.

Our Code of ethics governs an internal

auditor’s principles and rules of
conduct on: Integrity, Objectivity,
Confidentiality, and Competency.

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Core principles
The Core Principles, taken as a whole, articulate internal audit effectiveness. For an
internal audit function to be considered effective, all Principles should be present and
operating effectively.

Input
1. Demonstrates integrity.
2. Demonstrates competence and due
professional care.
3. Is objective and free from undue influence
(independent).

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Core principles
The Core Principles, taken as a whole, articulate internal audit effectiveness. For an
internal audit function to be considered effective, all Principles should be present and
operating effectively.

Process
4. Aligns with the strategies, objectives, and
risks of the organisation.
5. Is appropriately positioned and adequately
resourced.
6. Demonstrates quality and continuous
improvement.
7. Communicates effectively.
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Core principles
The Core Principles, taken as a whole, articulate internal audit effectiveness. For an
internal audit function to be considered effective, all Principles should be present and
operating effectively.

Output
8. Provides risk-based assurance.
9. Is insightful, proactive, and future-focused.
10. Promotes organisational improvement.

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2. Our love affair with governance
The IIA is the internal audit profession's global voice, recognized authority, acknowledged
leader, chief advocate, and principal educator.

AO 70: Internal BSP 499: AC and IA BSP 871: Internal control

audit services function (Financial and internal audit
(Government) Institutions) (Financial Institutions)

Code of Revised Code Blueprint for Revised Code of

Regulatory
Corporate of Corporate Corporate Corporate
environment
Governance Governance Governance Governance
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Year 73 85 94 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16

Search for ASEAN Corporate

Advocacy
Outstanding Internal Governance
support
Audit Department Scorecard (ACGS)
(IIAP and SEC)
Integrity
Initiative
AGIA Survey on
Public sector Islands of Good
Performance Internal Audit
Governance System Governance Practice in Public
(PGS) (IGG) Sector
Definition

OECD/BSP ICD
“… set of relationships between a “… the system by which companies
company’s management, its are directed and controlled by a
shareholders and other stakeholders company’s board of directors acting
…” collegially …”

Vermulean SEC
“… an ecosystem built on trust and “… the framework of rules, systems
value creation …” and processes in the corporation …”

A set of behavioural patterns A normative framework

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11 principles of good governance
ICD OECD Jess Estanislao
1. Independence 6. Fairness 9. Ethics
2. Rights and duties 7. Accountability 10.Social responsibility
3. Original powers to 8. Transparency 11. Sustainability
decide
4. Loyalty
5. Long-term viability

The Board – collectively – is the head of the corporation.

The Board is a collegial body and acts collegially. Rights and duties of the Chairman, the CEO,
principles for check and balance, and insurance for collegial decision-making.

The Board is duty-bound to act always and decide in the interest of the corporation.

It is vested with fiduciary duties and called upon by law to discharge with care and the due
diligence of any prudent director.

The Board is duty bound to decide and act always with the long-term viability of the
corporation in mind.

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Framework: The Tricker Model

Roles Conformance Performance

Accountability Strategy formulation
Outward Report to shareholders Review of strategic plan
looking Legal & reg’y compliance Set company direction
Audit reports review Determine strategy

Supervising executive Policy-making

activities Approve budgets
Inward
Executive performance Executive compensation
looking
Review results + budgets Corporate policy
Corrective action Corporate culture
Focus Past and present Future

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3. Future-proofing the profession
The IIA is the internal audit profession's global voice, recognized authority, acknowledged
leader, chief advocate, and principal educator.
BS Internal Auditing
MS Internal Auditing
Ladderized
BSBA Internal Auditing
BS in Internal Auditing BS Accountancy
(Far Eastern University) (Far Eastern University)

Master of Accountancy
Course
Major in Internal Audit
offerings
(University of San Carlos)

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Year 73 85 94 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 18

CMO 43 s2010 CMO XX s2016

CHED rules Graduate Programs Bachelor of Science in
in Accountancy Internal Auditing
Making ourselves relevant, globally
The IIAs Competency Framework defines the competencies needed to meet the
requirements of the IPPF for the success of the internal audit profession.

Improvement and innovation In the pipeline with AGIA:

Foundations on risk
Internal audit delivery management

Risk and controls workshop
Personal skills
Foundations on information
systems auditing
Persuasion and
Information systems auditing
Communication Critical thinking workshop
collaboration

Developments in internal
auditing – a briefing
Technical expertise
In the pipeline with BaiPhil:
Governance, risk Business
IPPF
Certification in Finance and
and control acumen
Internal Audit

Internal audit management On offer with ICD:

Enhancing Audit Committee
Professional ethics Effectiveness (12 Oct)

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From the accountancy profession
Recent developments from CHED and the Board of Accountancy

Certified
Public Certified Professional Accountant Opportunities arising:
Accountant (CPA)
Competency-to-curriculum
(CPA) Mapping Project

Development of Course
Workbooks, Cases and
Advanced Advanced Advanced Advanced Textbooks
+ 3 y/OJT + 3 y/OJT + 3 y/OJT + 3 y/OJT
Identification of Internal
Auditing Faculties

Teachers’ Training on Internal
Certified Accountant (CA)
Auditing Subjects

Expanding internal auditing

BS Internal education:
BSA BSMA BS-AIS
Auditing
Master of Science in Internal
Auditing Program

Minor-Major Programs
K-12 Program
(ABM Stem)

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In summary
Strengthening the AGIA–IIAP partnership

1. Briefing on the state of internal audit to Internal auditors from

NGAs, GOCCs, GFIs,
facilitate understanding of principles, SUCs and LGUs. It’s
standards and frameworks. primary objective is to
promote the development
2. Support advocacy for strong internal of its members toward a
auditing in the public sector. strengthened internal
audit service which will
3. Provide trainers on topics related to ensure:

quality service delivery
practice of internal auditing. and

efficient and effective
utilization of state
resources.

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Thank you

Mhycke C. Gallego
CPA, CIA, CCSA, CRISC, MPM, CMC, CRMA
Chairman and President, Institute of Internal Auditors Philippines
Knowledge Management and Advisory Partner, P&A Grant Thornton

[email protected]

This presentation is not a comprehensive analysis of the subject matters covered and may include proposed
guidance that is subject to change before it is issued in final form. All relevant facts and circumstances,
including the pertinent authoritative literature, need to be considered to arrive at conclusions that comply
with matters addressed in this presentation. The views and interpretations expressed in the presentation are
those of the presenters and the presentation is not intended to provide accounting or other advice or
guidance with respect to the matters covered.

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