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Internal Auditing

Course developer

Prior knowledge

Ekon3089, Accounting of Government Institutions

Ekon3091, Management Accounting

Ekon4102, Financial Accounting

VadZ4027, Entrepreneurship

Course abstract

The course provides basic knowledge of the system of internal auditing in Latvia, the scope, principles and methods of internal and external audits, explains the common and different features of internal and external audits and gives knowledge of the role and organization of internal control in enterprises and institutions.

Learning outcomes and their assessment

1. Students will be able to: demonstrate the understanding of the history of auditing and the latest trends in auditing, the knowledge of the essence and concept of internal auditing - discussions in classes, independent work.
2. Demonstrate the knowledge of internal control, the need to identify internal control risks ate enterprises - test with calculations.
3. Demonstrate the knowledge and understanding of the application of an internal auditing methodology - test with calculations.
4. Reasonably and independently apply internal auditing methods - discussions in classes.
5. Independently apply the modern norms of internal control - group work.
6. Responsibly apply the professional practice standards for internal auditing - independent work.
7. Responsibly plan the completion of the assignments given - independent work.
8. Communicate with group members about the topics assigned, understand one’s own role in group work and express one’s own opinion reasonably - group work, a summary.
9. Group work, a summary - discussions in classes.
10. Independently justify decisions and define the need to introduce internal auditing at an enterprise - tests, practical assignments.
11. Understand and analyse internal control problems - tests, practical assignments, group work.

Course Content(Calendar)

1. Course introduction. Contemporary understanding of business entities internal audit (lecture – 1 hour, practical task – 1 hour).
2. Internal control elements, system forms and main characteristics, areas of application (lecture – 1 hour, practical task – 1 hour).
3. The role, essence and tasks of internal audit. Historical development of internal audit (lecture – 1 hour, practical task – 1 hour).
4. Best audit practice. Work with people (lecture – 1 hour, practical task – 1 hour).
5. Systems of internal audit, functions of internal control system, their advantages for auditors (lecture – 1 hour, practical task – 1 hour).
6. Internal auditor professional ethics basic principles. Code of Ethics (lecture – 1 hour, practical task – 1 hour).
7. Methodical features of business entity main cycle operation audit (lecture – 1 hour, practical task – 1 hour).
8. Forms of revision and relation to other activities (lecture – 1 hour, practical task – 1 hour).
9. Organization and planning of internal audit structural units’ activity (lecture – 1 hour, practical task – 1 hour).
10. Internal risks of entrepreneurship. Determination of priority system according to risk evaluation (lecture – 1 hour, practical task – 1 hour).
11. Evidence obtaining in internal audit (lecture – 1 hour, practical task – 1 hour).
12. Determination of strategy and resources alignment (lecture – 1 hour, practical task – 1 hour).
13. Documentation, verifications and results evaluation (lecture – 1 hour, practical task – 1 hour).
14. Report preparations (lecture – 1 hour, practical task – 1 hours).
15. Closing of internal audit. Review of internal audit structural units’ activity (lecture – 1 hour, practical task – 1 hour).
16. The main requirements of contemporary internal audit staff management system (lecture – 1 hour, practical task – 1 hour).

Requirements for awarding credit points

Accumulating assessment is made up of: 1) two tests successfully completed during the semester: the theoretical fundamentals of an internal control system; forms of revision and the association with other activities; 2) practical tasks enforcement activities. If the test has not been credited, overwriting of the test will be permitted once, in writing, for theoretical issues and practical tasks learned during the semester.

Description of the organization and tasks of students’ independent work

Establishment of an internal auditing group based on a methodology for internal auditing: work organisation and a plan for auditing. The identification of a priority system based on a risk assessment. The documentation, verification and assessment of the results of internal auditing.

Criteria for Evaluating Learning Outcomes

Weighting rates %: two tests (20% + 25%), independent work (45%) and activity in practice (10%). Accumulating assessment of the results of studies (100%).

Compulsory reading

1. Vērdiņa G. Iekšējā kontrole. Iekšējais audits. Autora izdevums. Rīga: Jumavas grāmatnīca, 2013. 74 lpp.
2. Kusins J., Zariņa V. Gada pārskats un iepriekšējo periodu kļūdas. Palīglīdzeklis grāmatvežiem. Rīga: SIA “Biznesa augstskola Turība”, 2017. 351 lpp. Sērija “Uzņēmējdarbības bibliotēka” Nr. 69, ISBN 978-9934-543-09-8
3. Mālderis G. Grāmatvedība. Revīzija. Audits. 3. papildizdev. Rīga: Biznesa augstskola Turība, 2008. 144 lpp.
4. Daņēviča D. Finanšu pārskatu revīzija: starptautiskie revīzijas standarti.Rīga: Biznesa augstskola Turība, 2003. 128 lpp.
5. KVS iekšējais audits. 3. daļa, Kvalitātes vadības sistēma. Rīga: Biznesa Partneri, 2008. 78 lpp.

Further reading

1. Brūna I. Iekšējās kontroles pamatprincipi. Rīga: LU, 1999. 20 lpp.
2. Svare A. VID audita rokasgrāmata. 1.daļa. Rīga; Izdevniecība LAPA, 2007. 156 lpp.
3. Бычкова М., Итыгилова Е. Внутрифирменные стандарты аудита (СД – книга). Москва: Изд-во «Бухгалтерский учет», 2006. 544 с.
4. Rurāne M. Uzņēmuma finanses. Rīga: Apgāds Jumava, 2007. 266 lpp.
5. Соколов Б., Рукин В. Системы внутреннего контроля. Москва: ЗАО «Издательство «Экономика», 2007. 442 с.
6. Januška M. Finanšu un grāmatvedības kontrole firmā. Rīga: Merkūrijs LAT, 2003. 144 lpp.
7. Kurme S. Iekšējā audita profesionālās prakses standartu – izmaiņas 2004. gadā.. Rīga: SIA Ernests & Young Baltic. Semināra materiāli. 2004.
8. The Professional Practices Framework. Florida, USA: The IIA Research Foundation, 2005.

Periodicals and other sources

1. iFinanses. Rīga: iŽurnāli. Pieejams: http://www.ifinanses.lv. ISSN 2255-985x
2. Bilance: žurnāls par grāmatvedību, likumdošanu un finansēm. Rīga: SIA Lietišķās informācijas dienests. ISSN 1407-5709

3. Bilances Juridiskie Padomi. Rīga: SIA Lietišķās informācijas dienests. ISSN: 2255-9507

Notes

Restricted elective course in ESAF Academic Bachelor Study Programme “Economics”, “Accounting and Finance” specialization