FAQ

Internal Audit FAQ

1. Who are internal auditors?

As defined by the Institute of Internal Auditors (IIA), "Internal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization's operations. It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes. Internal Auditors' roles include monitoring, assessing, and analysing organizational risk and controls; and reviewing and confirming information and compliance with policies, procedures, and laws. Working in partnership with management, internal auditors provide the board, the audit committee, and executive management assurance that risks are mitigated and that the organization's corporate governance is strong and effective. And, when there is room for improvement, internal auditors make recommendations for enhancing processes, policies, and procedures."

2. Why does Air Niugini have an internal audit function?

The Internal Audit Office exists by charter and by-law to assist Air Niugini management and the Audit Committee Chairman & BOD in effectively fulfilling their responsibilities. We are charged with examining and evaluating the policies, procedures, and systems which are in place to ensure: the reliability and integrity of information; compliance with policies, plans, laws, and regulations; the safeguarding of assets; and, the economical and efficient use of resources. In simpler words, we're here to help.

3. How are reviewed areas selected for audit?

An annual audit plan is developed by the Chief Internal Auditor together with Senior Internal Auditors based on significance and risk. This plan is reviewed and approved by the Board of Directors through the Board Audit Sub-Committee. In addition, special projects and investigations are undertaken upon request by the Management or the Board of Directors.

4. What are internal auditors looking for?

Primarily compliance with Air Niugini policies and sound internal controls. Air Niugini’s policies are designed to help ensure we all comply with applicable laws and regulations and operate efficiently. By following these policies we help protect Air Niugini from unnecessary risks and help ensure sound business practices are consistent throughout the company. However, not all internal controls can be codified in policy. If we find control weaknesses, we regularly make recommendations to implement a control even though it may not be specifically required by policy.

5. Are internal auditors responsible for internal controls?

Management is responsible for maintaining an adequate system and designing of internal control. Internal auditors independently evaluate the adequacy and effectiveness of the existing internal control systems by analyzing and testing controls. The Internal Audit Department makes recommendations, based on independent review and assessment to management to improve controls.

6. What if something isn't handled correctly?

IA only makes realistic and achievable recommendations for improvement. It is the responsibility of the management to weigh possible additional costs of implementing our recommendations in terms of benefits to be derived and the relative risks involved.