ACC 376 INTERNAL AUDITING Sandra Shelton

Internal Auditing
Accounting 376
School of Accountancy
DePaul University
Spring Quarter, 2015
1:30-3:00 PM/TTH
Professor:
Office:
Office Hours:
Phone:
Email:
Dr. Sandra Shelton
6022 DePaul Center
4:00 – 5:00 TTH or by appointment
(312) 362-8098, Fax (312) 362-6208
sshelton@depaul.edu
Required Text:
Internal Auditing: Assurance & Consulting Services, Reding et al., The Institute of Internal Auditors
Research Foundation (2013), Third Edition.
Course Description
This course covers a risk-based, process and controls-focused internal audit approach. Topics
include internal audit standards, internal control, corporate governance, risk assessment, evidence
and documentation, fraud risks and auditing techniques including sampling and the use of systemsbased audit techniques. Professional ethics, emerging issues are discussed.
Course Objectives
This course provides an understanding of the internal audit function and the basic audit concepts that
internal auditors need to know and understand. This course will allow students desiring a career in
internal auditing to continue their education by taking courses directed at specific aspects of internal
audit. In addition, since internal audit has become a significant portion of the advisory client
services of many CPA firms, this course allows students interested in a career with a CPA firm to
increase their auditing skills.
1
Assignments
Your success in this course requires your careful attention to and use of the course outline and
assignment sheet that accompanies this syllabus. It is your guide through the material in your
textbook and the other course materials. In order to cover the required material, only one or two days
will be devoted to a chapter. As a result, this course requires more reading (and less problem solving)
than you are used to in your other accounting courses. Systematic preparation for each class is an
absolute must for success.
Chapter Assignments
Reading is an important aspect of the study of internal auditing. The assigned chapters must be read
in advance of class. In class, we will be covering the principal points from your readings and
clarifying questions that may have arisen in them. The questions at the end of each chapter of your
text provide a review of the important content of the chapter. It is suggested that you develop
answers to these questions as you review the content of the chapters.
Comprehensive Questions and Case Studies
The assigned questions and cases should be prepared in advance of the class on which they are
assigned. Preparation of the questions and cases consists of notes or an outline as to how you would
answer them. They will serve as a basis for class discussion. Class participation is strongly
encouraged.
In Class Assignments
In class assignments will consist of questions relating to assigned readings and cases. The
assignments will be completed in a group setting. Students are expected to have read each assigned
case and to be prepared to discuss key concepts in the case. Cases presentations should include a 10
minute PowerPoint presentation, accompanied by a written document addressing each case question.
The purpose of these assignments is to generate discussion of important issues in the text.
Term Project
The Team Project involves risk assessment. The team approach was chosen because becoming an
effective internal auditor requires learning to operate successfully as a team member. The team’s
report determines the grade for each member of the team. By the fourth class meeting each team will
be assigned a company for which the team will complete a risk analysis project. Meetings will be
scheduled to allow team members to meet with internal auditing professionals and executives at
designated companies. The Risk Assessment Project is designed to:
 To provide teams of students with an understanding of how an annual or periodic internal
auditing department audit plan is developed
2



To provide students with an understanding of the internal auditing practice at one
organization and to allow class discussions to explore how internal auditing may differ in
industries and companies
To allow students to meet with internal auditing professionals and executives in a
business setting
To provide students an opportunity to sharpen interview skills
Grading
Mid-term examination
Final examination
Class Participation:
Discussion*
Cases
Williams Case
Team Project
25%
25%
5%
5%
20%
20%
100%
Grading Scale
A = 93% and Above
A- = 90% to 92%
B+ = 87% to 89%
B = 83% to 86%
B- = 80% to 82%

C+ = 77% to 79%
C = 73% to 76%
C- = 70% to 72%
D+ = 67% to 69%
D = 60% to 66%
F = 59% and Below
Includes posting and discussion of current articles on Internal Auditing
Exams
The mid-term and final examinations may contain multiple choice questions and essay questions.
The final will be comprehensive.
Other Policies
Assignments are to be handed in on the due dates. Examinations are to be taken when scheduled.
Cases of academic dishonesty are viewed as a serious violation of professional ethics and will result
in an F Grade.
3
Week
3/31
4/2
4/7
Course Outline and Assignments
Topics
Assignments*
Course Overview
Get acquainted and Review Syllabus
Dick Anderson,
Group assignments
Clinical Professor
The Center for Strategy, Execution,
The Internal Auditing Profession
and Valuation
Chapter 1
PNC Charter
Introduction to Internal Auditing
The Professional Practices Framework:
Standards of Practice
Case 1- Chapter 1
Chapter 2
Discussion Questions 1 through 6
http://www.theiia.org/guidance/standa
rds-and-guidance/ippf/standards
Chapter Case 2
Audit Committee and Internal Audit
Function Case
4/9
Team Project (Planning and Resources)
Electronic Working Papers
4/14
Information Technology Risks and Controls
Chapter 7
Discussion Questions: 1, 2
Chapter Case 1
IT Audit Case:
Alek Ismayilov
Dennis Trejo
Financial Services Advisory
Ernst & Young, LLP
4/16
Conducting the Internal Audit/Reporting on
Assurance Engagement Outcomes
Chapters 12 & 13
Prior to class Review the Williams
Hospital Internal Auditing Case,
including:
Hospital Summary & Financial
Statements;Description of Internal
4
Audit Department;Stark Regulations
And Case Requirements
4/21
Corporate Governance/ Risk Assessment
Process
Chapters 4 & 5
TeamMate: Research on Company &
Industry Background
Case 1 Chapter 5
4/23
Internal Control
COSO
Chapter 6
Discussion Questions: 1, 2 & 3
Chapter Case 1
Project 1 due: Testing LOC
Agreements
4/28
4/30
Midterm Examination
Global Issues Impacting the Internal Auditing
Profession
Chapter 7
Discussion Questions: 1, 2
Chapter Case 1
Ray’s Rolling Stores
5/5
Gathering and Documenting Audit Evidence
5/7
5/12
Risk Assessment Project
Fraud Risks and Controls
5/14
5/19
Pulse of the Internal Audit Profession
Risk Assessment
Chapter 9
Discussion Questions: 1 through 6
Chapter Case 1
Case 2 Chapter 5
Chapter 8
Discussion Questions: 1, 2, 4, & 5
Chapter Cases 1 and 2
Garrett Care Rental Case
5
5/21
Governance
Chapter 3
Discussion Questions: 1 through 5
Chapter Case 1
Mike Joyce
Chief Auditor & Compliance Officer,
Blue Cross Blue Shield Associates
5/26
CAE Meetings
5/28
Managing the Internal Audit Function
Chapter 9
Discussion Questions: 1, 2 & 3
Chapter Case
Bruce Adamec
Guest Speaker
6/2
6/4
6/12
Group Presentations of Internal Audit
Term Projects
Group Presentations of Internal Audit
Term Projects
Final Examination
11:45-2:00 pm
* Comments from Guest Speakers during the beginning of the class
as noted will be incorporated into the discussions during the
remainder of each class session.
** Team Meetings with Chief Audit Executives are scheduled for
the week of April 20 and the week of May 25.
Reading assignments are Posted by date on D2L
6