Business Process Design and Internal Audit

UNIVERSITY OF TEXAS AT DALLAS

Course Syllabus
Spring 2005

Instructor: Mark Salamasick, CIA, CISA, CSP

Course Number: AIM 6380

Semester Hours: 3

Location: SOM 2.801

Time: Thursday, 4:00-6:45 p.m.
Office Phone: (972) 883-4729

Email Address: Mark.Salamasick@utdallas.edu

Endorsed Internal
Audit Program: http://som.utdallas.edu/eiap
UTD IIA Students
Chapter: http://www.utdallas.edu/iia
Homepage URL: http://www.utdallas.edu/~msalam
Office Hours: Wednesday and Thursdays, but call ahead. Also by appointment.

Course Overview:
The course will cover internal audit from a broad perspective that includes information technology, business processes, and
accounting systems. Topics include internal auditing standards, risk assessment, governance, ethics, audit techniques, and
emerging issues. The course covers the design of business processes and the implementation of key control concepts and
will use a case study approach that addresses tactical, strategic, systems, and operational areas. Improvement in
effectiveness and efficiency will be covered in the areas of operations, finance and technology. The course is open to all
majors with an interest in the design and testing of controls for improving management processes. This is the first course
leading to Endorsed Internal Audit Certificate and will prepare students to sit for the Certified Internal Auditor Exam.

Prerequisites:
- The prerequisite for the class is that you have an undergraduate degree or be in the last 15 hours of
the degree program.

- The other prerequisite for the class is that you have a strong desire to learn about Internal Audit. You
should also have a strong interest in completing a twelve credit hour program in Internal Audit and
passing the Certified Internal Auditor exam.
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Required Materials:
• The Goal, A Process of Ongoing Improvement, Second Revised Edition, Eliyahu M. Goldratt and Jeff
Cox, 1992. You can obtain from Half Price books, online or many other sources.

• CIA Model Exam Questions 2004 from the IIA International. Cost is $25 for IIA members, you
need to also join as a student member see below.

• CIA Review Materials, Gleim (Parts 1 and 2 required for the course, but exam is 4 Parts) . 11th
Edition is the current Edition. The material is available from the bookstores or directly from the IIA
and can be ordered at www.theiia.org. The CIA exam has undergone extensive changes and the 10th
edition will not be current!

• Access to the Protiviti website. You will be provided an ID and password to this site.

• Student Membership in IIA International which is available for $30. See www.theiia.org. This will
give you membership to the IIA for one year with subscription to the magazine. You should also join
the UTD student IIA chapter which will make you eligible to interview for internships, full time
positions, resume book, company visits, golf outing and much more.

Course Objectives:
• Understand the different roles of the internal auditor.
• Current understanding of internal audit standards, guidelines, and emerging issues such as COSO and
Sarbanes Oxley.
• Develop knowledge of Internal Audit and assurance services terms and procedures, including an
awareness of advanced internal auditing information processing concepts.
• Develop knowledge of business design practices and internal control frameworks including COSO.
• Become familiar with sources for Internal Audit
• Preparation for the Certified Internal Auditor Exam.
• Utilize the Internet as a research and communication tool for internal audit.
• Network with Internal Auditors in the DFW area.
• Learn the controls and key questions to ask concerning the control techniques and the business
process.
• Learn the concepts of efficient and effectively controlled environments. Also, be able to explain why
these controls are necessary and if there are any compensating controls explain why the controls may
not be necessary.
• Be able to adapt an audit checklist and audit program to various internal audit environments.
• Develop skills necessary to be able to perform an internal audit and prepare an internal audit report.
• Be able to describe some of the common features of audit software and be able to describe scenarios
where to integrate into the audit practice.
• Learn those areas of business risk and well-designed internal control systems. .
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• Understand how to adapt audit coverage in various industries and emerging audit issues.

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Homework:
All assignments should be completed and turned in on time. A number of assignments will require you to
prepare the assignment in PowerPoint and make a short presentation in class. Most of these assignments
will be due the Wednesday before class and should be posted to WebCT.

Attendance:
Notify the instructor in advance, if possible, if you cannot attend class. Class attendance is extremely
important since many of the topics and guest speakers are unique to the class discussion. We will also be
working on class projects involving actual audits with the UTD Audit Department which will require
meetings at other times.

Communication:
We will make use of WebCT for posting assignments and Case Study material. Also, discussion in class
is the best way to learn as many of you bring varied backgrounds that can add different views to the
class.

Handouts:
The course will have numerous handouts and case studies that will be used to stimulate class discussion.
It is your responsibility to obtain all handouts if class periods are missed. Numerous presentations will be
used to compliment the course with current material.

Tests:
These will be given throughout the semester to test your preparedness for the actual CIA exam. Students
will be expected to study and learn the exam material outside of class and be prepared with any questions
during the class. Saturday review sessions for the CIA exam will be established if desired by students.

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Grading:
Your grade will consist of the following:

Percent

2 CIA Review Exams 25%

Case Studies 25%
Class Audit Project 25%
Class Assignments and Class Participation 25%
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Total Points 100%

Class Portal and Current Topics:

A number of websites will be valuable resources during the course of the semester. All students will have free
access to the subscription service of the Protiviti KnowLeader site. We are one of only few classes in the
country to have this access and you need to take advantage of the resource during the class. This will allow us
to be very current on our topical coverage along with indexed links to numerous other sources. You will have
an id and password that is issued for use during this class. Current topics from the site will be discussed during
the class. You will also receive a twice a month newsletter from Protiviti of current audit events. You are
expected to followup and read accordingly for discussion in class.

Dallas Chapter of the Institute of Internal Auditors

The local IIA Chapter has monthly meetings. Three meetings are held during the spring semester and you are
strongly encouraged to attend. The dates are set at January 13, February 8, March 3, April 7 and May 5th.
The meetings on January 13 and May 5 should be quite good and although we don’t start class until that date
you would benefit by attending the luncheon. You are invited to attend the luncheon meetings from the Dallas
Chapter of the IIA at a reduced rate and possibly free as long as you guarantee that you will show. These
meetings offer you an opportunity to network with audit professionals, hear great speakers, and learn more what
is going on in the Dallas area. The local chapter http://www.dallasiiia.org/ has more than 1,200 members and is
one of the only platinum chapters in the world. In addition the Information Audit and Control Association
meetings(http://www.isacantx.org/) are at reduced student rates. Meetings are typically on Thursday at lunch.
This association has over 600 local members. The national IIA site is www.theiia.org and national ISACA site
is www.isacantx.org.

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IIA Student Chapter

During the fall semester of 2003 a student chapter of the IIA was formed at the University. Participation in the
chapter is highly recommended. We continue to need assistance with the student chapter and the chapter will
be having meetings, internship opportunities, golf outings, and a resume book. An Information Session about
the program is planned for the second week of class. Individuals can participate in the Student Chapter and not
the class. This will be a great opportunity for those wanting to get full time employment, internships, learn more
about the program, network with many companies throughout the country along with IIA International. It is
important for all students to have an up to date resume and take special care to speak knowledgable about
internal audit during those interviews. The student chapter will take on key projects including working with firms
in building integrated automated workpaper case studies.

Endorsed Internal Audit Program:

This course along with other requirements will lead to a Endorsed Internal Audit Certificate from IIA
International. Details of those requirements are given on the webiste citm.utdallas.edu/eiap. You must have on
file an application for the program along with acceptance of the faculty advisor to be considered part of the
program. This endorsement is highly recognized in the business community and the criteria for the UTD
program is established to ensure a high degree of credibility.

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Class Schedule:
The class schedule is subject to change, based on the needs of the students. We will have many guest
speakers for the class in addition many case studies to cover. Changes to the class will be discussed as
the need arises.

Schedule
Week Date Topic Quiz/Case
Study
1 January 13, 2005 Introduction
Student Chapter Presentation
Resume Review and Discussion
Overview of the Audit Process and COSO
Model
Course Resources Overview-www.theiia.org
www.protiviti.com
2 January 20, 2005 Risk Assessment Process and Audit Planning- Assignment #1
UTD Audit Group Case Study 1
3 January 27, 2005 Business Process Design Discussion –JC
Penny-Completed Reading of The Goal

4 February 3, 2005 Internal Audit Standards Assignment #2

5 February 10, 2005 Audit Programs and Audit Workpapers Case Study 2
6 February 17, 2005 Internal Audit Skills-Types of Engagements,
Communicating Results
7 February 24, 2005 Ethics Assignment #3
8 March 3, 2005 Audit Status and Test Part I Test
N/A March 10, 2005 Spring Break
9 March 17, 2005 Sarbanes Oxley Presentation Case Study 3

10 March 24, 2005 Audit Software and CAATS - Integration into Case Study 4
the audit process
11 March 31, 2005 Fraud
12 April 7, 2005 Control Self Assessment and The Audit Role as Case Study 5
Consultant
13 April 14, 2005 Corporate Governance Assignment #4
14 April 21, 2005 Enterprise Risk Management

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15 April 28, 2005 Class Wrap Up, Discussion Part II Test