AuditNet

The Value of Social Networks for Auditors

2009-05-27T09:16:00.002-04:00

This seems to be a question that is floating around the online professional audit community and I thought it would be useful to provide my insight based on my experiences.

I have found LinkedIn to be a very effective tool for networking, getting answers, fostering communication through discussions and sharing. I have found subject matter experts to develop audit work programs and monographs. The network is continually growing and each new member brings their unique skill set to the table to help others. The Google group (http://groups.google.com/group/auditnet/) has attracted a lot of members but no discussions as of yet. I have found the blogs to be good as far as posting but have not seen much feedback. No activity on the Yahoo group (http://finance.groups.yahoo.com/group/auditnet/) but I have not been actively promoting it. I have also created a new networking group in Ning (http://auditnet.ning.com). I hope that by positioning a number of options that auditors will sign up and communicate as I expected when I built AuditNet in the early 1990's.

Twitter is another story as it is a combination of microblogging and instant messaging; a concept that is entirely foreign to our generation but common with the younger set. I anticipate as new auditors enter the scene they will be comfortable with this method of communicating and will use it to network with other peers.I have found an isauditor who posts a new tool a day on Twitter and look forward to more of this happening. I remember when I wrote the article for The Internal Auditor in 1993 on Establishing an Online Information Network for Auditors (AuditNet) there were very few professionals using email and even less that could conceive of a hypertext application that would be useful for auditors. I see a great deal of synergy in this new social networking environment that could be harnessed for the benefit of auditors in the same way that AuditNet was built in the 90's. I agree there is a lot of drivel in the Tweets posted but if we get the right mix of people in a Tweet for Auditors Network we could find a new way of progress through sharing.

I would love to hear your comments and feedback on the value of social networks for auditors.

Jim

AuditNet® - RuleSphere Launch Industry First GRC Requirements Initiative

2009-05-22T17:15:00.000-04:00

FOR IMMEDIATE RELEASE:
CONTACT:James KaplanAuditNet LLC
auditnet@gmail.com
www.AuditNet.org

Vienna, VA May 6, 2009 — Today, AuditNet® and RuleSphere International announced the launch of the first Governance Risk Compliance (GRC) industry initiative that will leverage and promote the well-proven process of Requirements Management to assist companies with a granular approach to sustaining compliance, managing risks, and designing and deploying internal controls. Under the terms of this global program both firms will work together over five years to release GRC requirements groupings for specific industries, regulatory mandates, processes, and enterprise functions. Requirements addressing audit management for the pharmaceutical and retail industries are scheduled for release in Q3 and Q4 2009. Other requirements groupings will follow based on customer priorities and interests.

“AuditNet will offer its premium subscribers an optional service where they will be able to access, manage, and add requirements to the base requirements that we release,” commented James Kaplan, CEO of AuditNet. “They will use RuleSphere’s Requirements Central Software-as-a-Service (SaaS) platform to categorize and assign requirements, produce requirement baselines, document issues, set priorities, develop use cases, produce elegant reports and a number of other management functions. The subscriber can start with one person and add individuals as needed. Subscription terms and pricing will be announced in Q3, 2009 for pharmaceutical and retail audit management.”
For additional information contact:James KaplanAuditNet LLCauditnet@gmail.com
www.AuditNet.org

Phil WilsonRuleSphere International, Inc.1(877)438-0742info@RuleSphere.com
www.RuleSphere.com

Using Social Networking for Professionals

2009-05-22T08:51:00.002-04:00

The Internet is an incredible source of networking capabilities for professionals auditors and accountants. Over the last year I have been building a networking tool using LinkedIn which has proven to be an effective and efficient way to reach out to peers, demonstrate expertise, answer questions and more. The LinkedIn Professional Audit Information Network (http://www.linkedin.com/e/gis/44252/7B41D7082F9A) now has about 2,700 members. Recruiters are not permitted so the only postings are by professionals looking for answers, sharing opportunities for training, resources and more.

LinkedIn is not the only social networking tool for auditors. I am looking at Twitter http://twitter.com/auditnet and other tools to see how we can ensure that the audit "world is flat" and that we are all maximizing technology to further our profession.

If you have suggestions on how we can improve our communication lines using social networking or stories, benefits or other information please contact me by posting a comment on this blog or sending an email to auditnet@gmail.com.

Thanks,

Jim Kaplan
AuditNet.org
The Global Resource for Auditors

AuditNet LLC and CCH Team Up to Provide Audit Programs to 60,000 CCH TeamMate Users Worldwide

2008-05-02T19:55:00.000-04:00

(Vienna, VA., May 1, 2008) – AuditNet LLC (AuditNet), a leading Internet audit community and global resource for auditors today announced that it has entered into a strategic distribution agreement with Wolters Kluwer Tax and Accounting, a leading provider of information, services and software solutions serving tax, accounting and audit professionals worldwide under the CCH brand name, . Under this agreement approximately 2,000 audit programs maintained on the AuditNet Internet site will be available at no charge to CCH TeamMate (TeamMate) users in the powerful TeamMate TeamStore format.

“Internal audit professionals worldwide will benefit from this distribution agreement between CCH and AuditNet,” said AuditNet CEO and Founder, Jim Kaplan, CIA. “The mission of AuditNet is to leverage the power of the Internet to benefit the audit profession and coupling one of the largest collections of audit programs in the world with TeamMate, the Industry’s leading Audit Management tool, will drive significant efficiencies into audit departments around the world.”

Over 60,000 auditors from more than 1,500 organizations worldwide use TeamMate to increase the efficiency and productivity of the entire audit process, including risk assessment; scheduling and timekeeping; workpaper preparation and review; report generation; and audit issue tracking. Customers include Fortune 100 and Fortune 500 corporations, small- and medium-size enterprises and government agencies.

The TeamMate suite consists of five key products that can be used independently or with other components of the suite. Those products are: TeamMate EWP, electronic workpaper system; TeamCentral, audit issues tracking; TeamRisk, risk assessment tool; TeamSchedule, advanced scheduling; and TeamMate TEC, time and expense tracking.

“AuditNet is recognized as one of the premier audit resources on the Internet today and we are very pleased to enter into this agreement which will drive unprecedented efficiencies into the audit planning process,” said Mike Gowell, vice president and general manager of CCH TeamMate. “There is a tremendous amount of knowledge contained in over 10,000 audit steps on the AuditNet web site, however sifting through this document-based content can be time consuming. By making this content available in CCH TeamMate TeamStore format, TeamMate users can search across thousands of audit steps and programs to instantaneously find and import exactly those steps they need into their audit.”

About AuditNet
AuditNet is the global resource for auditors conceived and developed by Jim Kaplan, the Institute of Internal Auditor’s 2007 Bradford Cadmus Award recipient. A key feature of the site is a comprehensive library of audit documents (e-tools) including audit work programs, control questionnaires, audit checklists, and risk matrices. The document formats include Microsoft® Word, Microsoft Excel®, Adobe® PDF and plain text. These e-tools are sought after by auditors across industry type in both the public and private sector. Access to the documents requires registration on the AuditNet® site. There are currently over 81,000 registered users for the AuditNet® e-tools.

About Wolters Kluwer Tax and Accounting
Wolters Kluwer Tax and Accounting, a unit of Wolters Kluwer, is a leading provider of tax, accounting and audit research and compliance information, services and software solutions. Serving professionals worldwide, Wolters Kluwer Tax and Accounting operates in the market as CCH, a Wolters Kluwer business. CCH has served tax, accounting and business professionals and their clients since 1913.

Wolters Kluwer is a leading global information services and publishing company. The company provides products and services globally for professionals in the health, tax, accounting, corporate, financial services, legal and regulatory sectors. Wolters Kluwer has annual revenues (2007) of €3.4 billion ($4.8 billion), maintains operations in over 33 countries across Europe, North America and Asia Pacific and employs approximately 19,544 people worldwide. Wolters Kluwer is headquartered in Amsterdam, the Netherlands. For more information, visit http://www.wolterskluwer.com/.
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Exciting Changes in Auditing

2008-04-18T09:03:00.000-04:00

Recently a question was posted in the Auditing Section of LinkedIn regarding what are considered exciting changes in auditing. As usual the subject matter prompted me to post the following response:

In my opinion the following represents some of the key exciting changes in the audit industry:

1. The Internet has provided auditors with research capabilities that have not been fully realized. Service provider consolidations have improved the types of resources and tools available which greatly benefits small and medium internal audit functions. Internal auditors can now tap into templates for the audit process 24/7/365. The global audit network is available to answer questions and share information at a level never before experienced.

2. Business failures and the resulting mandated legislation such as Sarbanes-Oxley have highlighted the importance of internal controls and accountability for all organizations. These have cast internal audit in a new light that has raised the status and recognition of the function as a key component of the risk management system within organizations. While the legislation was directed at large publicly traded corporations the effects have filtered down to small and medium size companies, not for profits, and governmental entities.

3. There are more opportunities for jobs and career advancement in auditing than ever before. According to the Occupational Outlook Handbook; Strong growth of accountants and auditor jobs over the 2006-16 decade is expected to result from stricter accounting and auditing regulations, along with an expanding economy. The best job prospects will be for accountants and auditors who have a college degree or any certification, …

4. There still seems to be an emphasis within the higher education system to direct students to public accounting rather than internal auditing. Internal audit practitioners should get involved in teaching a future generation of auditors that the public accounting and CPA track may not be for everyone and that there are other options. A greater emphasis needs to be placed on fostering integrated auditors that are comfortable with available and developing CAATTs.

Jim Kaplan AuditNet.org The Global Resource for Auditors

Links:
http://www.auditnet.org
http://www.theiia.org
http://www.bls.gov/oco/ocos001.htm

Following is the link to the question as well as other responses:
http://www.linkedin.com/answers/finance-accounting/auditing/FIN_AUD/209291-15092191

If you would like to comment on what you feel are exciting changes in auditing please respond either here or via the LinkedIn Answers section. (btw this is another example of ways for auditors to use the Internet).

Breakdown of Internal Controls DC Tax Payments

2007-11-14T15:27:00.000-05:00

The District of Columbia seems to be the focus of when things go wrong and internal controls break down. The latest headline reads D.C. Tax Scam Could Total $31 Million Analysis Suggests Refund Fraud Scheme Was Snowballing. This is the biggest corruption case in local government history according to federal prosecutors. Ficticious payments to ficticious companies represented a serious flaw in the review and approval process within the D.C. Department of Finance Tax Office. It also demonstrates that internal controls can be circumvented by collusion as this occurred when a clerk prepared the payments and then gave them to supervisor who reviewed and approved them. Both employees as well as others were involved in the scheme. An alert bank clerk alerted authorities to suspicious activity.

This begs the question "where were the managers and the oversight in this situation" and why didn't something come to their attention over the past seven years while this was taking place. The answer of course is that these scenarios start small in order to test whether controls exist. When the perpetrators find that no one questions the payments they escalate until eventually their own greed leads to detection.

Local government auditors need to review fraud detection techniques to ensure that controls are in place and operating as planned. The last thing you want is to see your jurirsdiction's name in bold print on the front page of the local or national newspaper. Take what happened in the District of Columbia as a wake up call to pay close attention to review controls over payments in all areas

See the complete article posted on AuditNet at http://www.auditnet.org/articles/dctaxscam.pdf

School Activity Fund Frauds: An Accident Waiting to Happen

2007-11-12T05:55:00.000-05:00

The following article appeared in the Washington Post on November 9, 2007 (Student Money Vanishes, but Few Are Punished Activity Funds Are Often Plundered and Mismanaged by Adults). I have maintained for a long time that management of these funds was an accident waiting to happen. As an internal auditor for Fairfax County Public Schools I observed firsthand the types of abuses that occur regularly in school activity funds. Despite reporting mechanisms such as independent audits that show control weaknesses many of the abuses are repeated year after year. This is in large part due to who controls the funds, lack of effective policies and procedures, and an overall position that these are not material to the financial statements and therefore do not warrant attention.

Across the United States millions of dollars are collected each year for student activity funds. These funds are under the direct control of the principal of the school. While the funds may seem immaterial (from several hundred dollars up to hundreds of thousands of dollars) when you consider the amounts collected by school district the number easily reach millions of dollars a year.

Student activity money is collected from vending machines, sporting events, bake sales and other activities approved by the school principal.

The funds are supposed to be used to promote the general welfare, education and morale of students through activities such as field trips, school publications etc.

The funds are the responsibility of the school principal.

School districts are supposed to have policies and procedures covering the collection, safeguarding, and expenditure of school activity funds.

The funds should be audited each year by an independent accounting firm.

However the reality is that procedures for collection, safeguarding and dissemination are not always followed. Not all the money collected is recorded in the school's accounting system. Funds are not promptly deposited and are kept in insecure locations (unlocked desks) or safes with access by multiple personnel. Funds are spent for purposes other than the benefit of students. School principals routinely give the responsibility for oversight of the funds to individuals not properly trained. Due to lack of internal resources (such as internal auditors) funds are not audited on a regular basis. Additionally the school districts external auditors may not even be aware of the funds available and therefore do not look at whether appropriate internal controls are in place.

While at Fairfax County Public Schools I reviewed reports issued by an external auditor hired on a contract basis to review the school activity funds. The control weaknesses identified by the external auditor occurred year after year without little if any changes. In addition eventhough the State Education Department mandated that EVERY SCHOOL ACTIVITY FUND BE AUDITED EVERY YEAR, there was no requirement that the State Education Department be provided with a copy of the report. The cost to the County was over $250,000 and was borne by the taxpayers rather than being paid for by the Student Activity funds (over $40 million dollars collected).

There needs to be greater oversight by school officials including internal auditors. There should be minimum standards for individuals responsible for student activity funds. Additionally when problems are identified prompt action needs to be taken. The cost of independent audits or audit oversight for these activity funds should be be funded by proceeds collected.

There are many public school districts where the internal audit department has responbility for auditing school activity funds. Unfortunately many of those same public school districts do not adequately fund internal audit functions to maintain effective oversight of internal controls for student activity funds or other school district operations.

What happened in the District of Columbia should be a wake up call for public school districts across the United States.

IIA International Conference Observations

2007-09-21T17:09:00.000-04:00

The Bradford Cadmus Memorial Award was presented at the 2007 IIA International Conference in Amsterdam. The International Conference was truly an incredible event. It provided a unique opportunity to network with professionals from around the world, meet with auditors who had been regular users of the AuditNet site and reach out to new auditors from many countries who have only recently discovered the opportunities for sharing available via the Internet. Receiving the Bradford Cadmus Memorial Award was the icing on the cake and was a very special moment for me and my family.

I joined the Institute in 1984 shortly before passing the Certified Internal Auditor exam. I immediately got involved by becoming a volunteer member of the Northern Virginia Audit Club and then a Charter Member of the Northern Virginia Chapter. In 1989 I had the privilege of serving as the Chapter's Third President. During that year I worked closely with the other professional organizations in the Washington, D.C. area and brought Larry Sawyer to the area for a full day seminar. My wife and I had the honor of taking Mr. Sawyer and his wife Esther out to dinner. I was in awe as this was the father of Modern Internal Auditing and a recipient of the Bradford Cadmus Award in 1973. My first thought when I received the phone call (from Bill Taylor) was to pinch myself because I was being honored with the same award given to Larry Sawyer, Mort Dittenhoffer, Jim Wesberry, Dave Dunbar, Jim Hooper , Hans Spoel, Anthony Ridley, and Bill Taylor all of whom I have personally met. It was a great feeling and a tribute to every auditor who supported me in my quest to build an online information network for auditors.

I recently received photos and a video from the event and thought it would be appropriate to post them here along with my acceptance speech.

CADMUS ACCEPTANCE SPEECH

It is truly an honor to receive this award and be recognized by my peers for doing something that I felt needed to be done and as well loved doing.

AuditNet was conceived by merging two things; Progress Through Sharing (the motto of the IIA) and the Internet, a medium created expressly for the purpose of fostering communications between individuals sharing a common interest.

Little did I know that an article that I wrote for the Internal Auditor Journal in 1993 would result in the creation of a global digital information network. This was dream that became a reality.

This week I have met auditors from around the world who have never met me face to face or shaken my hand. Yet they knew who I was, perhaps sent an email and visited the digital resource that I created. Coming to Amsterdam personalized a sometimes impersonal environment.

AuditNet would not have been possible without the support of the IIA, which acted as an incubator for my conceptual model. Additionally the support of the global audit community was a necessary ingredient in growing this tool. Finally I must acknowledge the support of my family, and especially my wife Robbie, who endured my many hours of surfing the net, sending emails and promoting the use of the Internet as an audit tool.

Involvement in the IIA truly changed my life. I am proud to be an internal auditor and more importantly to be an active member of the IIA.

Thank you all for this prestigious award!

Internal Auditor Recognized by Global Organization

2007-07-19T07:04:00.000-04:00

ALTAMONTE SPRINGS, Fla. — In honor of his outstanding contributions to the internal audit profession, James Kaplan, CIA, was awarded by The Institute of Internal Auditors (IIA) with the prestigious Bradford Cadmus Memorial Award during The IIA’s 2007 International Conference, held in Amsterdam this week. Initiated in 1965, the award is named after The IIA’s first managing director and recognizes internal audit practitioners for research, academic involvement, article and book publication, and other thought-leading pursuits.

“I’m honored to recognize Mr. Kaplan for his innovation and dedication to our profession,” said IIA Chairman of the Board Stephen D. Goepfert, CIA. “He has been an inspiration to auditors around the world by speaking, writing, and encouraging use of the Internet as an audit tool and discovering new ways to leverage the Internet to benefit the profession.”

Kaplan has been an internal auditor for more than 26 years and is the founder of AuditNet.org, an Internet portal used by thousands of auditors each month to foster the development of modern internal auditing around the world. AuditNet has provided the global audit community with audit programs and guides, links to more than 1,300 audit-related Web sites, career guidance, and more since 1995.

Prior to retiring from Fairfax County Government in 2005 after 19 years of service, Kaplan worked for Fairfax County Public Schools and Arlington County. During this time, he represented the profession on the National Intergovernmental Audit Forum and served as a volunteer reviewer for the Association of Government Accountants Service Efforts and Accomplishments initiative. While at Fairfax County, he was awarded Outstanding Performance Awards in 1995 and 1997 for his contributions.

Kaplan is the author of The Auditor’s Guide to Internet Resources and The Auditor’s Guide to Internet Resources 2nd Edition, published by The IIA, and has written for various publications, including Internal Auditing Alert and the Internet Bulletin for CPAs on audit uses of the Internet. He has pioneered using the Internet for auditing through his Web site and through speaking at conferences for internal auditors and accounting professionals and meetings for The IIA, ISACA, AICPA and others.

As an active IIA volunteer during the last 22 years, Kaplan has served at the global level as a member of the Communications Advisory and Membership Committees. At a local level, he has served IIA–Northern Virginia in various leadership roles, including chapter president, member of the board of governors, and professional development vice president.

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Established in 1941, The Institute of Internal Auditors (IIA) is a global professional association for internal auditors around the world, with headquarters located in Altamonte Springs, Fla., USA. The IIA serves more than 130,000 members from 160 countries by providing professional development, guidance, and certification. The Institute stewards and promulgates The International Standards for the Professional Practice of Internal Auditing and is the profession’s global voice, recognized authority, acknowledged leader, chief advocate, and principal educator.

Digital Forums for Auditors

2005-03-02T14:50:00.000-05:00

A blog is basically a journal that is available on the web. The activity of updating a blog is "blogging" and someone who keeps a blog is a "blogger." Blogs are typically updated daily using software that allows people with little or no technical background to update and maintain the blog. Postings on a blog are almost always arranged in chronological order with the most recent additions featured most prominently.

More than 10 years ago, I wrote an article for The Internal Auditor on establishing an online information network for auditors. The AuditNet concept has matured into a useful resource for auditors around the world. A relatively recent phenomenon called Web logs or Blogs provide a unique digital sharing opportunity for auditors. While this phenomenon has caught on with some professions, I have not seen much evidence of blogs for auditors. Blog sites could be useful for auditors to share information on such topics as Sarbanes-Oxley, corporate governance, audit committees, whistleblower programs and more. In fact, when I did a search for Sarbanes-Oxley Blogs, I found the following:

White Collar Crime Prof Blog
Web Optimization Blog
Inside Sarbanes-Oxley

Blogs may remain a little used resource for auditors. That does not mean that auditors should not refrain from sharing their views on audit related topics on the Web. Tread carefully and think about how you can use this Web-based discussion forum for auditing.

Stay tuned for more journal entries from the AuditBahn!

Internet Search Skills for Auditors

2004-11-15T19:37:00.000-05:00

One of the core competencies of digital literacy is developing search skills for the information superhighway. In order to master this competency auditors need to know the different tools for finding information including search tools. When I say search tools most auditors assume I am talking about applications such as Google or Yahoo. It is true that these represent one category of search tools for auditors. However email discussion groups, interactive forums and email represent truly powerful search tools that many auditors overlook. These interactive one to one and one to many applications are the basic foundation upon which the Internet was created. That foundation represented the ability of professionals to collaborate in a digital environment, sharing information to find answers to issues and troubleshoot problems. Perhaps the most powerful and compelling case for finding information using the Internet is the concept of Internet meta-information or digital information sources. If you can locate a Web site and find a contact (email, phone, or address) you have the possibility of finding answers or locating information through these contacts.

I have found that Internet search skills require a multi-faceted approach in order to be truly successful.

If you have a unique technique or methodolgy to locate digital information please email me at editor@auditnet.org so that I can share this information with the online AuditNet community at www.auditnet.org

Thanks,

Jim Kaplan
AuditNet LLC

AuditNet Blog Welcome Message

2004-11-12T10:58:00.000-05:00

Welcome to the AuditNet Web Log or blog. The purpose of this forum is to share approaches to using the Internet in auditing. This can include ways to integrate the Internet into the audit process, sharing audit knowledge and experience, sharing approaches and resources or mentoring new auditors in a digital environment. I have found that the Internet is truly a sharing environment that can greatly impact our profession. Audit associations have established Web sites and forums for the benefit of their unique members but there are still many "unaffiliated" auditors that need a place to go for support and digital camaraderie. AuditNet is that place.

I encourage you to visit the AuditNet site at www.auditnet.org and see the digital resource I have created for the audit community. There are audit programs, audit guides, checklists, questionnaires, email discussion forums, links to audit resources, job information and much more! If there are resources, tools or information that you cannot find there please let me know and I will consider adding it to the site. If you find other sites that offer information that is of value, let me know and I will add a link from AuditNet. Finally if you have digital resources or tools that would help other auditors, I encourage you to share them with me and the global audit community.

Let me know if you would like me to cover anything in this Blog by sending me an Email at editor@auditnet.org.

Thanks,

Jim Kaplan, CIA, CFE,
Founder and Prinicipal of AuditNet.org