MEASURING SUCCESS

Internal Audit Performance

Measures

Internal Audit Performance

Measures

Why should we measure performance

Differing Approaches
What we are currently doing
Next Steps

Why
Internal Audit is like any other business
unit
Increasing requirement to report regularly
against agreed performance measures

Differing Approaches
Traditional Approach
Balanced Scorecard Approach

Traditional Approach
Typical Measures
Audit Plan Delivery
Timing of Draft and
Final Reports
Quality of Service
Financial Indicators

Pros

Cons

Measuring
the same
things
Peer
comparison
easier

Records the
past
Doesnt
consider
strategic
considerations

However, some unanswered questions:

How well are stakeholder expectations being met by Internal Audit
How are the performance objectives of staff linked to those of the overall
function?

Balanced Scorecard Approach

Stakeholder
Customer
Internal Process
Innovation, Learning
and Growth

Vision and Strategy

Balanced Scorecard for Internal Auditing

Board/Audit Committee
OBJECTIVES

Expectations

Perspective on IA Roles

List here.

Perspective on IA Roles

MEASURES

Satisfaction Surveys

List here.

Satisfaction Surveys

Risk Concerns

Requests

CAE/AC Private Meetings

Complaints

CORPORATE
STRATEGY

Management/Audit Customers
OBJECTIVES
List here.

MEASURES

Internal Audit Processes

OBJECTIVES

List here.

List here.

MEASURES
List here.

INTERNAL AUDIT
STRATEGY

Innovation/Capabilities
Experience
Education

OBJECTIVES
List here.

MEASURES
List here

Importance Levels
Improvements
Findings

Training

Repeat Findings

Certification

Savings

Reporting Relationships

Quality Assessment

Current Reporting - Covalent

Example Measures:

Status

Customer Results
Efficiency
Effectiveness
People

Performance Indicator

Description

Current
Target

Current
Value

Last
Update

IA001_6a.1 Timeliness of
Audit Report..

% of respondents who agreed

that the audit report was
produced timeously

100%

100%

Q4
2010/11

IA002_6a.2 Audit Report

Delivered..

% of respondents who agreed

that the audit remit was
addressed by the audit
report .

100%

93%

Q4
2010/11

IA003_6a.3 Kept Informed of

Audit Progress..

% of respondents who agreed

that Internal Audit kept them
informed of progress.

100%

93%

Q4
2010/11

Current Reporting - Word

No

Indicator/Description

Measurement

09/10

10-11

Audit Plan Delivery

Actual number of audits delivered against
planned number of audits on the audit
plan.

actual plan completion v

planned completion

115%

100%

Reporting
Issue of draft report after completion of
fieldwork.

% of draft reports issued

within 15 working days of
fieldwork completion.

100%

100%

Reporting
Issue of final report after management
response to draft received.

% of final reports issued

within 5 working days of
management response
being received.

100%

100%

Quality
Customer feedback survey responses with
either a satisfied or very satisfied rating.

Target 80% of satisfied or

very satisfied customer
feedback responses

96%

96%

Quality
Number of actions implemented by due
date.

Target 80% of actions

completed by management
when due.

85%

61%

Quality
Number of audits completed within
planned time budget.

Target 75% of total audit

assignments to be
completed within planned
time budget.

91%

85%

Next Steps
Agreement on approach and standard
areas for setting performance measures
Is there a need for Working Group?