1.1 Introduction
Integrating informatics with accumulated audit knowledge, at the end of the year 2000, the re-conceptualization of management services was carried out, and a new concept was formulated: Remote Auditing.
In its beginnings it was called Monitoring, the work carried out remotely, where the available salvo was taken at the branch and through the Easy Exploitation Audit System (SAFE), a group of options that were defined for monitoring were processed; preparing a report with the problems detected in the maximum organizational structure at the complex level and no evaluation was given to the result of this audit.
1.2 Modified service portfolio
Based on the considerations made, the evaluation of the service portfolio, through the use of the BCG matrix, which was detailed in the first chapter and the incorporation of the concept of Remote Auditing, the initial portfolio is transformed into that shown in continuation:
- There are three products in the introduction stage, which generate encouraging expectations for the future of management, since they denote the existence of development and innovation. The trend of regular auditing to become a dead dog to return to a dairy cow service is reversed. Two derived base services Supervision and Monitoring and Evaluations on request are incorporated, which extend the educational nature of the audit.
Monitoring and Supervision
In daily practice, the terms Monitoring and Supervision are used interchangeably to denote the verification of the correspondence of the operations carried out in a given activity with what is established for it. However, for the purposes of this work, it is convenient to establish differences between these terms, since in the work of Remote Auditing there are two aspects that have this common characteristic, but which differ when they are carried out.
Supervision is a base service derived from the concept of Remote Auditing that consists of evaluating operations based on the existing information (available at the branch) of the entities served by the audit body, which has the fundamental advantage of constituting a tool for the administrations of the units, since potentially dangerous deficiencies can be prevented or eradicated without needing to reach extreme situations. It should be noted that this service allows the incorporation of the preventive and educational factor, an inherent part of the audit work, especially the internal one.
To the above it must be added that this practice allows the audit unit to detect common deficiencies present in all the units belonging to a Head Office or several, as well as to carry out reviews of the information of the auditable entities, as part of its systematic activity, with a high degree of periodicity and low cost.
Active Supervision is but an appendix to Supervision; When any problem that may hide a serious or criminal act is detected, it is not only reflected in the opinion that is issued, but the documentation in the unit is reviewed and a special audit is carried out (if necessary), that is, the Investigation of some aspects and others are left to the complex to be investigated and prepare a Measurement Plan. Another aspect that includes active supervision is that, within a complex, a unit is determined and an IN SITU check is carried out with the characteristics of the first day of an audit. Surprisingly, the merchandise is counted and the boxes are arched, verify the salvo in our power, among other aspects; To carry out this verification, you must have the corresponding work order.
Monitoring is a complementary tool in the audit work and also constitutes a base service derived from the use of the concept of Remote Auditing, whose main objective is to detect, in real time, anomalous situations that denote deficiencies, in correspondence with their risk levels., that demand an immediate and reasonable response from its origin and a consequent decision-making for its solution.
To achieve this objective, it is necessary to determine a set of indicators that are representative of the activity carried out by the unit and which should be reviewed in correspondence with the results obtained in the identification of the fundamental risks of these entities, from which the audit unit can estimate, easily and quickly, the presence and potential severity of these and decide, depending on this assessment, the decision to carry out a more detailed subsequent analysis or the execution of an audit if the evidence so advises, in Therefore, administrators and managers can carry out the pertinent corrective actions, daily.
Evaluations upon request
Operations Evaluation on Demand is a new base service derived from the concept of Remote Auditing that consists of evaluating operations based on existing information (available at the branch or in the unit itself) at the request of the managers of the complex, which has as a fundamental advantage that the indications of possible inappropriate operations are verified without transcending the collective, thereby protecting the prestige of those involved, when it is determined that they do not exist.
Notwithstanding the recent introduction of the Request Evaluations service, it has been used three times, with the following aspects being requested:
- Reliability evaluation of the inventories carried out in a unit, from the analysis of the time elapsed between the preparation of the physical intake, the verification lists are obtained and the counts are updated (according to the trace file). Incorrect processing in the box of prices of frozen products, causing shortages in the inventory from the comparison of the average weight, determining the averages for packages, boxes and days for comparison. Bad operation of the Silver system in relation to the Cuadres, Passes to the Historic, Salvos and Changes of Accesses.
The procedure used for the delivery of the results has been to supply these to the administrations so that they evaluate the results of the violations or problems that are reported at a distance, if this does not imply an audit; but from now on the working papers will be filed together with a report with all the problems, the original of which will be delivered to the maximum manager of the unit.
1.3 Features that differentiate Distance Auditing from traditional
As an example of the differences favorable to the performance of Distance Audits in relation to traditional Regular Audits, we begin with the aspects that are subject to verifications and verifications by the traditional method.
Twenty-two aspects or topics are verified and analyzed in the traditional Regular Audits that are carried out, with the use of the same computer tools used in those carried out remotely.
In these audits, regardless of the fact that through the use of the SAFE it is possible to determine which transactions and which aspects of the cash discipline you should review, which are not all of them, it is always necessary to transfer to the office a quantity of documentation that You must review and need to visit the audited unit a certain number of times in order to collect information, carry out verifications and interview with the audited, etc.
In the case of Distance Audits, we have previously indicated that until the III Quarter of 2001, 63 aspects were verified and that in those carried out in the IV, 74 were verified, which provides the auditor with a broader universe of aspects to verify.
In these audits, initially the auditor only went to the unit in exceptional cases, requesting clarifications by phone or to be shown certain documents in his office. Currently, without ruling out the use of the telephone, a day is dedicated to visiting the audited unit in order to verify on-site specific aspects that are determined after the analysis of all the information obtained, as well as to verify aspects such as: the organization and filing of documentation, analysis of primary documents, the use of cross-reference in documents where this is necessary, double custody of cash, customer service, as well as other aspects deemed necessary.In all cases, the time the auditor travels to the entity is greatly reduced. The analysis of the trace contained in the salvos is essential to carry out future analyzes and determine the qualifications that correspond to each case.
In addition, in the Remote Audits, analyzes of operations with possible risks are carried out, to obtain the tables of a group of SAFE options that represent the verification and validation of information from the SILVER (Inventory System) and then the other queries. These analyzes are currently being incorporated into normal audits, in addition to the documentary reviews being performed.
In this type of audit a commercial specialist is incorporated, who until the III Quarter of 2001 essentially checked six aspects, and currently does so with eleven, initially by analysis of the information and later dedicates two or three days of work to check on-site merchandise. In normal audits, not only is an opinion made of the problems, but an interactive work is done with the specialists of the unit, which serves to strengthen their work.
A computer specialist is not required, however 20 aspects of this type are reviewed in record time, which traditionally would triple the time invested or the analysis of so much information would not be possible.
This novel system is being applied in the unplanned units to be audited in 2001 and 26 of this type are already planned for 2002.
Advantages of Distance Auditing:
This way of carrying out the audits in a part of the auditable units does not eliminate the presence of the auditors in the units, but it does reduce the pressure that this causes and significantly reduce the transportation costs and the time lost in transfers or in awaiting the arrival of the transport.
This working method implies less aud / days, higher productivity, without leaving quality aside, when auditing the system and the risks that may arise.
Distance Auditing predetermines the aspects to be reviewed until they are varied by the top management and in traditional regular audits it is at the discretion of the auditor whether or not he obtains all the options enabled for each topic since in not all cases the same level of analysis is required.
Finally, the question must be asked: Can this work be done at this time with the proposed depth, without an adequate tool? Can the fact of carrying out the information save and transfer the documents from the unit to the post be classified as Remote Auditing? auditor's work ?. Obviously the answer is no; The Remote Audit that we carry out covers a period of three months, using the salvo of a unit, which is imported for the SAFE system, without interfering in the work of the unit, only on rare occasions for the verification of commercial activity and to verify the documentation in a general sense, without verifying all the documents, without reviewing all the audit tapes and with only two people.
1.4 Final considerations
Before concluding this chapter, it should be noted that the concept of Remote Auditing was introduced into daily practice, as a result of the expansion of the portfolio of conventional audit services, with new derived base services.
Based on the risk analyzes carried out, it was considered necessary to check in the Remote Audits, the initial verification of 20 options provided by the system (Easy Exploitation Audit System), designed by the management, which currently they add up to 74. Taking into account the knowledge acquired with the Distance Audits carried out, in 2001 this type of audit began to be carried out as one more regular audit, after this mechanism was approved by the Ministry of Audit and Control (MAC).
The use of informatics and a tailored audit system is vital in the process of Remote Auditing; which is called to replace traditional audits and a more efficient use of resources; as well as represents greater control of resources, increasing Internal Control in the units.
The number of audits carried out has been increasing over the years, but it is from 2001 that a true take-off occurs, concluding the year with 108 audits of a plan of 87, for an overcompliance of 24.14%, which shows in a reliable way, what we have been affirming regarding the increase in productivity with the use of this strategy, which will allow us to get closer, increasingly, to the Government's objective of auditing 100% of the entities.
Being the year where you work with the lowest average number of auditors, the highest number of audits is reached in the first three quarters of the year, the average number of audits per auditor representing 117.2% of what was achieved in 1998, the year with the highest average in the period analyzed and for 2002 it is planned to reach 124.1% compared to that same year. These results are achieved to a great extent, through the use of Remote Audits as can be seen in the following graph (computer audits are deduced):
With this new concept, auditing serves as a tool for control and supervision, it constitutes an essential element, which in turn must incorporate quality elements into its norms and procedures, in order to advance towards business excellence, whenever in this context the three (E) are manifested as follows:
Economy: With the introduction of Distance Auditing, a more rational exploitation and use of resources is made, both in quality and quantity, since the installed technical capabilities and human potential are fully exploited. On the other hand, salary expenses for the new incorporated services do not represent an additional expenditure for the audit body, but rather a change in the structure of these, since the excess time fund when applying the previous plans, allows, maintaining the level of expenses required by the classic service portfolio, incorporate new developments.
Efficiency: With Remote Auditing it is possible to carry out a greater number of audits, with the same time and workforce fund. In a comparative analysis of the actual behavior of the audit plan from the incorporation of Distance Auditing in the year 2000 with respect to the year 1999, a decrease in the hourly cost is observed by 6% and an overcompliance of the audit plan 34%, regardless of having worked in 2000, with an average of four auditors, less than in 1999.
Efficacy: It contributes to progressively transform the Audit Management into an excellent service capable of auditing and supervising all the units belonging to the branch annually, in addition to contributing to the increase of a control environment.
The economic impact achieved is manifested through the resources that should not be expended as a result of the increase in productivity, which will make it possible to reach all the entities with the audit and supervision work, annually.
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