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Ensure the internal audit function maintains a quality assurance and improvement

program, including internal procedures and assessments and a periodic external

quality assessment of conformance with the Institute of Internal Auditors’

International Standards for the Professional Practice of Internal Auditing


Internal Audit Administration

Review the Chief Audit Executive’s administrative reporting relationship to the Vice

Chancellor for Business and Finance to assure not only that independence is fostered,

but adequate resources in terms of staff and budget are provided to enable the

department to effectively perform its responsibilities. The Vice Chancellor has

administrative authority for approval of the Chief Audit Executive’s time, travel and

other expenses of the Office of System-wide Internal Audit. Additionally, the Vice

Chancellor may initiate a performance evaluation of the Chief Audit Executive at the

request of the Audit Committee or Chair of the committee. This administrative

reporting relationship is meant to facilitate administrative activities and does not

diminish the Chief Audit Executive’s reporting relationship to the Audit Committee

and the Board of Regents.

Review and approve the appointment, compensation, reassignment, or dismissal of

the Chief Audit Executive; review and approve the compensation and termination of

system office internal auditors; review the compensation of campus internal auditors;

and approve the termination of campus internal audit directors.

Risk, Internal Control and Compliance

Consider the effectiveness of the internal control system and compliance with laws

and regulations, including computerized information system controls and security.

Understand the scope of internal and external auditors’ reviews of internal controls

over financial reporting.

Make recommendations to improve the internal control and compliance systems to

ensure the safeguarding of assets and prevention and detection of errors and fraud.

The components of the control system are:


control environment—creating a culture of accountability;


risk assessment—performing analyses of program operations to determine if

risks exist;


control activities—taking actions to address identified risk areas;


information and communication—using and sharing relevant, reliable, and

timely information; and


monitoring—tracking improvement initiatives and identifying additional

actions needed to further improve program efficiency and effectiveness.

Review and evaluate risk assessments performed by management of the Board and its



Ensure that the Board, and the management and staff of the Board and its institutions

take all reasonable steps to prevent, detect, and report fraud, waste and abuse.