Internal Audit Charter

MISSION AND SCOPE OF WORK

Internal auditing is an independent, objective, assurance and consulting activity established within the district, designed to add value and improve an organization’s operations.  It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control and governance processes. 

The objectives of internal auditing are to assist the board, superintendent, and management of the district in the effective discharge of their responsibilities by furnishing them with analyses, appraisals, recommendations, counsel, and information concerning the activities reviewed and by promoting effective control at reasonable cost.

The scope of internal auditing encompasses the examination and evaluation of the adequacy and effectiveness of the organization’s system of internal control and the quality of performance in carrying out assigned responsibilities.  It includes:

• Reviewing the reliability and integrity of financial and operating information and the means used to identify, measure, classify, and report such information.

• Reviewing the systems established to ensure compliance with those policies, plans, procedures, laws, and regulations which could have a significant impact on operations and reports and whether the organization is in compliance.

• Reviewing the means of safeguarding assets and, as appropriate, verifying the existence of such assets.

• Reviewing and appraising the economy and efficiency with which resources are employed.

• Reviewing operations or programs to ascertain whether results are consistent with established objectives and goals and whether the operations or programs are being carried out as planned.

RESPONSIBILITY

The internal audit department is established by the board of trustees, and its responsibilities are defined by the board of trustees.  Responsibilities include, but are not limited to, the following:

• Establishing policies for the auditing activity and directing its technical and administrative functions.

• Developing a flexible annual audit plan using an appropriate risk-based methodology.

• Examining the effectiveness of all levels of management in their stewardship of district resources and their compliance with established policies and procedures.

• Evaluating the economy and efficiency with which resources are employed, identify opportunities to improve operating performance, and recommend solutions to problems where appropriate.

• Recommending improvement of management controls designed to safeguard district resources, and ensure compliance with government laws and regulations.

• Authorizing the publication of reports on the results of audit examinations, including recommendations for improvement.

• Performing and reporting on special reviews as may be requested by the Superintendent of Schools, the Board of Trustees, or others (i.e. TEA, state auditors, school attorney, etc.).

INDEPENDENCE
 

To provide for the independence of the internal audit department, the internal auditor will report administratively to the superintendent and functionally to the board of trustees. Administrative issues might include personnel issues such as leave, time and attendance, performance reviews, etc.  Functional issues might include the carrying out of specific responsibilities as those mentioned in the foregoing paragraph.

AUTHORITY

Authorization is granted for full and complete unrestricted access to any of the district’s records (either manual or electronic), physical properties, and personnel relevant to a review.   Documents and information given to internal auditors during a periodic review will be handled in the same prudent manner as by those employees normally accountable for them.

The internal auditor shall have access to the superintendent and take directly to the superintendent matters he/she believes to be of sufficient magnitude and importance to require immediate attention.   

Internal auditors have no direct responsibility or any authority over any of the activities or operations that they review.  They should not develop and install procedures, prepare records, or engage in activities which would normally be reviewed by internal auditors.  This does not preclude internal auditors from serving in an advisory capacity in the implementation of improvements or the establishment or re-designing of activities, policies, or information systems.  Additionally, this restriction shall not prevent internal auditors from performing analysis and recommending alternative courses of action to management.

PROFESSIONAL STANDARDS

The operating practices and procedures of the internal audit department will be in accordance with the International Standards for the Professional Practice of Internal Auditing, established by the Institute of Internal Auditors.

REPORTING

A preliminary written report will be prepared and issued by the internal auditor following the conclusion of each audit and will be distributed to appropriate administrative and management officials.  The manager of the activity or department receiving the internal audit report will be provided an opportunity to respond to the preliminary report.  That response will indicate what actions were, or will be, taken in regard to the specific findings and recommendations in the internal audit report.  If appropriate, a timetable for the anticipated completion of these actions will be included.

Subsequently, a copy of the full report with management’s response will be issued to the board of trustees, superintendent and appropriate administrators responsible for the area audited.

Approved:  March 26, 1997

Amended:   March 25, 1998

                    July 28, 2004

Original signatures on file.