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Risk-Based Auditing in the Czech Ministry of Finance

Lukáš Wagenknecht, Deputy Minister at the Czech Ministry of Finance, highlights the importance of internal audit, audit planning, and the roles of audit committees. The ministry follows a risk-based approach, utilizing process mapping, risk heat maps, and strategic planning to assess and address potential risks. The three lines of defense model and oversight by audit committees ensure quality and independence in auditing functions.

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Risk-Based Auditing in the Czech Ministry of Finance

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  1. Ministry of Finance of the Czech Republic Risk based auditing – national experience Lukáš Wagenknecht 1.st Deputy Minister at Ministry of Finance of the Czech Republic

  2. Agenda Ministry of Finance of the Czech Republic Introduction • Lukáš Wagenknecht • Ministry of Finance of the Czech Republic Internal Audit • 3 lines of defense • Importance of Audit Committees roles Audit planning • Process mapping • Risk Heat Maps • Strategic plan

  3. Lukáš Wagenknecht Ministry of Finance of the Czech Republic Ministry of Interior Foxconn Regional council of cohesion region Deloitte Vice President of Institution of Internal Auditors The Prague Public Transport Company Ministry of Finance of the Czech Republic 2003 – 2006 2006 – 2007 2007 – 2009 2009 – 2013 2009 -2013 2013 -2014 2014 - ? Agenda on Ministry of Finance ICT Audit Authority Control Department Central Harmonization Unit State Treasury, public sector controlling and accounting

  4. The 3 line defense model Ministry of Finance of the Czech Republic

  5. Importance of Audit Committee Roles Ministry of Finance of the Czech Republic • Oversee Internal Audit  Ensure independence  Assess quality  Direct reporting line • Assess quality external Auditor • Review risks • Oversee financial reporting • Coordinate assurance functions • Review internal control framework

  6. Audit planning Ministry of Finance of the Czech Republic 1. Audit Universe  Process mapping 2. Risk analysis  Interviews  Questionnaire  Assessing and scoring

  7. Process mapping Ministry of Finance of the Czech Republic

  8. Likelihood Impact Scoring Financial management Public tenders ICT Controlling of operational program Communication Assets Technical assistance Wages HR Education Social Fund 3,67 3,83 3,17 2,83 3,00 3,17 2,17 3,33 2,33 1,33 1,83 4,33 3,67 3,83 3,50 2,83 2,67 3,33 2,17 2,67 2,50 1,17 15,89 14,06 12,14 9,92 8,50 8,44 7,22 7,22 6,22 3,33 2,14 Risk Heat Map Financial management 5.00 Public tenders ICT 4.00 Controlling of operational program Communication 3.00 Potential impact Assets Technical assistance 2.00 Wages HR 1.00 Education Social Fund 0.00 0.00 1.00 2.00 3.00 4.00 5.00 Likelihood

  9. Strategic plan Ministry of Finance of the Czech Republic • Based on Audit Universe and Risk Heat Map • On 3 years basis • Gaps for Ad – Hoc audits and consulting • Keep up to date

  10. Ministry of Finance of the Czech Republic Questions ?

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