MANAGERIAL AUDITING GOVERNANCE ASSURANCE =
RISK
MANAGEMENT, REAL-TIME COUNTERPARTY SURVEILLANCE AUDIT TOOLS & REPURPOSED
VIDEOS &=
nbsp;
Avi Rushinek and Sara Rushinek, Universit=
y of
Miami (arush@miami.edu=
, arushine@aol.com)
Abstract
This manuscript describes how the managerial audit function can join
existing systems, subsystems, and future systems within an organization to
assure governance and manage risk effectively. This study describes specific exam=
ples
from a variety of organizations such as publicly traded corporations, entire
industries such as the electronics industry, and professional organizations=
, such
as the AAA (American Accounting Association). It is looking specifically a=
t the
collaboration of the managerial audit function with other professionals ins=
ide
and outside of the organization to better assure governance and manage risk=
. Among such functions and professio=
nals,
this study includes the accounting, legal, operational systems within an
organizations, and the professional that are involved with such systems, in
addition to similar professional outside such systems.
Introduction
Governance assurance
involves enforcing policies to attain organizational objectives. The trouble is that the managerial=
audit
function alone does not have all the skills and authorities to fully carry =
out
such functions. Therefore, th=
e managerial
audit function has to join forces with several other organizational subsyst=
ems
to form a joint team, and together carry out such function in an efficient =
and
effective way. For this reaso=
n, the
managerial audit function should be asking probing, searching questions and
ensuring sound responses from their counterparts in the legal, operations,
accounting and other organizational subsystems. Since the managerial audit functio=
n is
already overloaded with tasks, effectiveness and efficiencies could facilit=
ate
such additional efforts. This=
is
where counter surveillance systems can help. These systems will help the manage=
rial
audit function to collaborate with other functions without overloading an a=
lready
exhaustive workload.
Effective risk management
Effective risk management covers all risks - governance, management,
quality, reputational and financial. However it is focused on the most
important key risks, in a variety of the organizational subsystems. It requires regular monitoring and
review, giving rise to action where appropriate, this is where the counterparty surveillance system comes in.
It will enable the managerial audit function to observe activities
without being everywhere at the same time.=
Only upon an exceptional alert, should the managerial audit function=
be
there, helping to identify deficiencies and work with the other subsystems =
at
remediating such deficiencies and mitigating the risks associated with exis=
ting
deficiencies. Using new
technologies, the managerial audit function can gradually attain proficienc=
y in
effective risk management.
Managerial Auditing Governance Assurance =
Risk
Management , Real-time Counterparty Surveillance Audit Tools and Repurposed
Videos &=
nbsp; &nbs=
p; &=
nbsp; &nbs=
p;
The
area of Governance Assurance Risk Management (GARM), Real-time Count=
erparty Surveillan=
ce
Audit Tools and
Repurposed Videos deals with a dynamic
international forum for the examination of current practice in auditing (bo=
th
internal and independent). This Assurance Risk Management study informs about current research and
practice in financial and managerial reporting, accounting and auditing jud=
gments,
corporate governance, control and risk issues and review standards. Such relatively new standards in t=
he US,
like IFRS (International Financial Reporting Standards) are challenging many
managerial auditors (MAs).
How can the auditor deal with the=
diversity
of standards in a consolidated financial statements where some of the
subsidiaries are based on GAAP and GAAS, while the others are based on
IFRS? This study deals with s=
uch key
areas as: Audit and Assurance (financial and non-financial) across different
standards. This manuscript
describes how, with the help of new tools and training an IFRS system can be
converted to GAAP or vice versa to produce coherent consolidated financial
statements. What kind of Fina=
ncial
and Managerial Reporting will be required to comply with =
such
different standards? And more importantly, what is the c=
ost of
poor Governance, controls, risks and ethics, leading to litigations, forens=
ic
accounting practices, expert witnesses and computer litigation support. What kind of Organizational issues
including firm cultures, performance and development will be needed to cope =
with
such emerging trends?
In addition=
, this
study deals with the evaluation of changes occurring in the auditing
profession, such as shift from manual to automated systems, archive auditin=
g to
real-time pro-active auditing, wired to wireless environments, analog to
digital media, as well as the broader fields of accounting and assurance.
Auditors, <=
span
style=3D'mso-spacerun:yes'> once focused on checking the accoun=
ts for
fraudulent practice after the fact, have now developed a more proactive rol=
e,
like presiding over real-time audit that will prevent or stop fraud, nippin=
g it
in the bud with real time surveillance.&nb=
sp;
Guiding and maintaining continual improvement by integrating multi-m=
edia
evidence into the traditional pencil, papers and spreadsheets world. This n=
ew
approach is reflected in current study, which takes its readers beyo=
nd
traditional conventions and looks at the ways in which contemporary auditors
are improving both managerial and organizational performance.
This study presents a
wide range of material, focusing on integration of forensic auditing into t=
he
managerial audit work, with an emphasis on practical examples from expert
practitioners, such as professors and expert witnesses, specializing in
computer litigation support of managerial auditing. It shows how professional organiza=
tions
are dealing with the new realities and the challenges that they pose.
Assuring
Governance & Managing Risk Using Counterparty Surveillance Audit Tools &
Repurposed Videos
The article
addresses the relation between auditing theory and practice by exploring
trends, the shift from after the fact, 25 years after the Bernard Madoff ponzy scheme, to
real-time preventive controls, and Governance
Assurance Risk Management.
Key multidisciplinary collaborations include academics and researchers in the f=
ields of accounting, auditing, security, =
and
multimedia, which traditionally have had nothing to do with managerial audit
functions. Due to the integra=
tion
of new technologies into the managerial audit function, they can also
contribute to the new policies of better control of lower risk, and overall better
governance. Likewise, the more
traditional subsystems have to be integrated into the managerial audit
functions. Such functions inc=
lude
professionals in the area of finance directors, general managers, internal =
and
external auditors, and management consultants.
How can Managerial Auditors (MAs)
systematically reduce the risk of management? This manuscript integrates corpora=
te
governance and organizational management by demonstrating controls that int=
erconnect
management processes and functions. Such control include but are not limite=
d to
assets safeguarding, accurate budgeting, sales, expenses, and stock market
estimate forecasting models, and most importantly deploying new surveillance
technology with significant investments in corporate infrastructure. Such investments will be very cost
effective, as they will lead to better corporate governance, reduced risk a=
nd improved
control functions.
This papers provide readers with insight =
into
the various novel technologies and methods of the governance of risk
management, related assurance processes and their impact on organizational
outcomes. We are specifically dealing with empirical and theoretical issues
that have never been investigated by MAs.
Surveillance
enterprise risk management and IT personnel
This manuscript focuses on the design and implementation of ri=
sk
management surveillance sub-system and how such systems are integrated with
other governance control mechanisms to further enhance the entire system. F=
or
example, how better forecasting, budgeting variance analysis, compliance sy=
stem
software, PTZ IP AV network surveillance systems and real-time audits can
improve the enterprise risk management as opposed to traditional, silo-based
risk management systems, where the left hand does not know what the right h=
and
is doing. Likewise, the secur=
ity and surveillan=
ce
departments are isolated from the audit department, and also isolated f=
rom
the computer center and IT personnel.
Our approach proposes a comprehensive AV PTZ IP network
surveillance system that will provide real-time video conferencing among all
the company's
silo-based risk management systems, and what are the much better integrated=
outcomes
of more sophisticated technology of advanced counterparty surveillan=
ce risk
management and corporate governance systems, where everyone can, if
appropriate, hear and see everything in real-time.
Another area that needs the involvement of the managerial audit
function, is the legal and compliance subsystem. Let us look at such subsystems, and=
the
ethical problems as well as the risk
that may result in the
absence of such involvement
SOX regulation, risk management transparency, external and internal auditors governance.
We
have used the SOX as an example of the role of regulation and its impact on
risk management behavior. At =
the
organizational and individual levels, managers will be more responsible for fr=
aud
and other problems, therefore they maybe more interested in reducing their =
risk.
Such surveillance systems will enfor=
ce management
control design and disclosure policies that minimize dysfunctional behavior=
and
foster transparency, literally. The
MAs can speak =
to
intruders in real time and record the incident on their cell phone directly
from the surveillance cameras.
Further,
for accountability, they can attach these video clips to their working pape=
rs leading
to more visual, relevant, efficient and reliable reporting. Taking it to the next level, espec=
ially
for publicly owned facilities, such as border control, central train statio=
ns,
government public universities, can provide real time access to the
surveillance systems so anyone with internet access will be able to see and
record the activities, bypassing organizational stakeholders risk literacy
limitations, by making it visually obvious, in addition to the written
traditional risk reports. The=
role
of external and internal auditors in complementing and supporting risk
management and corporate governance, and the implications of that role for
auditor independence and audit quality.&nb=
sp;
The impact of changing environmental and economic conditions such as
climate change, the 2008 global credit crisis and economic downturn on risk
management and corporate governance.
Manag=
erial
auditors mixed cost forecasting assumption departure error estimates for
litigation and professional liability risk reduction
Manag=
erial
auditors have to become more involved with other subsystems in the
organization. One of these
subsystems, is the management accounting, budgeting, and forecasting activities, as well as in the areas=
of litigation
and professional liability risk reduction.=
Let us look at the case of the electronics industry.[1] As the Managerial Auditor Journal reports "=
;companies
are frequently relying on mistaken mixed costs (MC) forecasting assumptions.
Two such assumptions are that MC are linear within the relevant range and
variable costs vary proportionately with activity levels. "Departure f=
rom
these assumptions can lead to understating expenses, overstating profits, a=
nd
even to fraud, litigation, and mounting professional liability risk. Develo=
ps a
forecasting model of mixed cost error estimates, or error difference (ED). =
MAs can reduce the risk of litigation and professional liability by
including such an ED in the internal control structure of a company. If the managerial auditor is not
sufficient familiar with such areas, the managerial auditor should have some
dialog with experts in the area, or use automated expert systems to reduce =
the
risk of such errors. <=
span
style=3D'font-size:12.0pt;mso-ascii-font-family:Calibri;mso-ascii-theme-fon=
t:
minor-latin;mso-hansi-font-family:Calibri;mso-hansi-theme-font:minor-latin;
mso-bidi-font-family:"Courier New";letter-spacing:-.15pt'>If the deployment=
of
such experts or expert systems succeeds, then the managerial auditor should
establish it as a policy of continuous improvement and the Assurance of Learning on the
Internet World Wide Web (WWW). Such policies will keep costs under
control, promote realistic forecast and ethical behavior without the econom=
ic
hit due to over spending.[2] This paper
develops the theory of pre-emptive and preventive risk control policies by =
interdisciplinary
integration of the managerial audit function, with other organizational fun=
ctions,
and with new technologies leading to better governance assurance and risk
reducing practices. Some of s=
uch
organizational functions include but are not limited to the EDP audit funct=
ion,
physical security function, managerial financial and budgeting function, as
well as the external auditing functions.&n=
bsp;
Let us start by reviewing some of the EDP audit functional involvement of the
managerial audit, that will lead to better governance and risk reduction.
Literature Review
Evaluating Asset Safeguarding And Data Integri=
ty
In The EDP Audit
"Evaluating asset safeguarding and data
integrity in the EDP (Electronic Data Processing) audit", is an import=
ant
function of proper governance."[3] If people keep
misappropriating the assets of an organization, no organization can last. <=
/span>"Studies =
in
the area of evaluating asset safeguarding and data integrity have usually d=
ealt
with evidential evaluation procedures and the judgment decisions taken by t=
he
auditors during initial and subsequent audits. The qualities, measures and
techniques of asset safeguarding and data integrity when examined jointly
relate a degree of concern for cost-effectiveness considerations, internal
controls and the effects of making global judgments using piecemeal evidenc=
e. The design of the appropriate inter=
nal
control system, combined with the impact of proper data security and risk a=
nd
computer reliability, make up the circumambience under which auditors', as =
well
as management's, assessments are brought to bear." Managerial audit combined with the=
EDP
audit function can improve such asset controls.
PTZ IP AV Camera Systems Internet WWW Real Time Recording & Alert
Warning
Most of these controls are "after the fact" controls, in
contrast, the current study looks also at real-time controls. Such controls will place PTZ (Pan =
Tilt
& Zoom) IP (Internet Protocol) network security surveillance AV
(Audio/Video) camera systems. These 2-way full duplex audio cameras can also
provide video conferencing services, where the audio sounds just like a
phone. In fact some of these =
camera
systems have a Subscriber Identity Module (=
SI=
M)<=
/span> card, just li=
ke
many cell phone.
When the Internet WWW network is down, the Managerial Auditor (MA) c=
an
simply call the camera, by dialing its unique telephone number. Likewise, the camera can be prepro=
grammed
to call the auditor phone to alert the MA that at 3.00 am, there is
unauthorized traffic in the computer room.=
The MA can see the intruders in real time, and record their activity
from the MAs cell phone. Like=
wise,
the MA can ask the intruder to leave, and warn the intruder that the police=
has
been alerted and is on the way. Later,
the MA can attach the video clip to his working papers, illustrating the as=
set
safeguarding controls.
Refrain From Using Security Devices Either Because Of Their High Cos=
t Or
In The Erroneous
"Using experts for detecting & litiga=
ting
computer crimes", such a disaster, as intruding competitors stealing t=
he
computer equipment of the firm with its software and data, may harm a
firm. Recovering from a disas=
ter
like this, requires some business continuity plans.[4] "Whilst=
the
development of a crime-proof computer operating system seems is very unlike=
ly,
more could be done to deter, discover, litigate and punish computer crimina=
ls. Because of the limited sophisticati=
on of
security devices, experts shy away from them, while managers and attorneys
(unaware of their limited sophistication) refrain from using security devic=
es
either because of their high cost or in the erroneous belief that computer
crime is a low risk. To control computer crime, the computer experts should
assist both management and the legal community, especially where management
loosely carries out the existing policies, procedures, and preventive contr=
ols,
giving a false impression of high security which makes it even more difficu=
lt
to discover and gather evidence of crime." Collaborating with the management =
audit
function, all parties can deal more effectively with computer crimes.
Now we encourage companies to use security devices because of their =
low
cost and high reliability. So=
me wireless
network IP PTZ AV cameras are selling for less than $200, just like inexpen=
sive
cell phones. They are as
reliable as the internet WWW (World Wide Web) and the cellular telephone
network system, providing dual backup and recovery. If the WWW connectivity=
is down,
use the cell network, and vice versa.
As the surveillance systems have improved, experts can use them much
more extensively, and intruders will typically notice them and be much more
reluctant to commit crimes and take higher risks of being detected and
interrupted in real-time, and unable to carry out their crimes. As the camera systems can be progr=
ammed
to alert authorities as soon as the connectivity is stopped, or the power is
interrupted. The managerial a=
udit
function should interact with such security function, as well as management
accounting functions, and specifically for forecasting, and budgeting. Let us examine how such involvemen=
t can
result in lower error rate, lower risk, and better governance.
Discussion and Analysis
The MA can use tools such as “Sarbanes
Oxley Microsoft® Accelerator" with the he=
lp
of specialists in "Forensic Accounting, Expert Witness Testimony, &
Computer Litigation Support."[5] Notice that reputable professional
associations such as the American Accounting Association, train account=
ing
professor to teach about such compliance methods and tools, sponsored by
Teaching and Curriculum Section.&nb=
sp;
Notice the section that deals with "DVDs
for litigation support, including the pros and cons of different standards =
such
as DVD+/-RW/VR (Digital Versatile Disk, Read Write, and Video Recording),
DVD-RAM (Random Access Memory), HD (High Definition)-DVD, Blu-Ray DVD, DVD
Copying, dubbing, burning, and recording, focusing on the technical and leg=
al
facets." The integration=
of
such media into the surveillance system, will provide for inexpensive disas=
ter
recovery, business continuity planning in compliance with SarBox (Sarbanes
Oxley), but more importantly it will also provide very good record for
pre-emptive investigation of problems.&nbs=
p;
As the cameras are connected to a DVD-Burner carousel that copies the
videos and archives them on the DVDs.
For any variance analysis and exception investigation the MA can find
the AV evidence on the DVDs, solving disputes quickly, objectively and
effectively.
Assessment Automation Software for Accounting,
Teaching, and Recruiting Programs helps professional associations such as t=
he American Accounting Association (AA=
A) stream
line governance risk policies. Sponsored
by Teaching and Curriculum Section, the AAA and similar organizations teach
their members new technologies to deal with the governance risk reduction c=
hallenges.=
[6] With the current econ=
omic recession,
more and more ponzy schemes and fraudsters surface around the financial
landscape.
Assessment automation of
accounting programs by national, international, or regional organizations a=
nd
Recruiting Candidates implements governance risk reduction policies. Compli=
ance
with the EEOC and Sarbanes-Oxley represents such governance risk reduction
policies. As organizations le=
arn to
comply with the EEOC and SOX, they also build anti discrimination and anti-=
fraud
controls, as well as educate their members prevent, detect and correct the =
emergence
of discrimination and fraud. Likewise, certificate grantors use automated
assessment to test new candidates as well as re-certify existing members wi=
th
certificates such as CPA (Certified Public Accountant), CMA (Certified
Management Accounting), CIA (Certified Internal Auditor), CISA/M (Certified
Information Systems Auditor/Manager) for Continuing Professional Education
(CPE) credit.
Governance assurance risk management is v=
ery
expensive, therefore, training for efficiency and computer technologies are=
the
foundation of such systems.
Otherwise, they are simply too expensive to afford. Comput=
er
Preps, target Internet Publishing Video DVD/CD Recording, and web-casting in
addition to multi-media streaming tools to be more effective and efficient,=
and
provide a more enjoyable experience. Many companies cannot afford to fund
expensive training course vacations.
Thus, they opt for study at home programs, using self-study tools, s=
uch
as the internet and CD/DVDs, where students can review the materials quickly
and effectively. The focus of=
our
current research is in certification accreditation/reaffirmation efforts, w=
hich
is getting increasingly more complicated and demanding. As organizations become more compet=
ent
and keep up with technology, especially, the aging executives, governance
assurance risk management rises proportionately. Employees become more aware of the=
risk
they take, likewise they quantify the risk, and finally avoid taking excess=
ive
risk, such as some of the mortgage industry swaps and derivative, creating =
the
frozen financial market disaster of the 2009 era.
The only way to master it qui=
ckly
and efficiently is by some automated hands-on activities. What is assessmen=
t? And
what do regional accrediting agencies expect? Much like any assessment
activity, the evaluations and accreditation process involves: Developing an
assessment plan; Building and using measurement standards; Motivating
participants (existing and prospective faculty and students) to be involved=
and
contribute; Performance Evaluation Feedback; Risk Mitigation; Deficiency
Remediation Action; Revision of the assessment plan and recruiting streamli=
ne
automation.=
[7]
Repurpose surveillance DVD-recorded lectu=
res
using new Blu-ray® and HD-DVD® in the classroom can be very effecti=
ve
for CPE. This way CPA, CMA, C=
IA,
CISA/M that are taking an instructor led class can review it after class.
Universities and professional associations
that provide such training review test automation compliance with standard
producing organizations and/or government standards, such as NASBA, AACSB,
COSO, Sarbanes-Oxley, HIPAA, and Basel II. Such Universities and professional
associations Publish for students, alumnus, professionals, and the general
public, some of the materials for free and additional materials as part of =
the
membership or subscription. Web cast using multi-media streaming tools enab=
le
mass marketing, while lowering the cost of an average hour of instructions =
to
as low as $10 per hour. That =
makes
these courses much more effective and efficient, and provide a more enjoyab=
le
experience. Using the new Microsoft® Office 2010, and the new Windows 7=
®
Operating System (OS) deal much more effectively with new web technologies,
such as podcasting, Real Simple Syndication (RSS) feeds, streaming and
archiving media, especially for the Governance Assurance Risk Management (G=
ARM)
applications.
Teaching managerial auditors how to use a
cell phone as a computer for messaging, e-mail, video-conferencing, and eve=
n as
a remote control (using the phone's key pad to move the camera, 6-moves to =
the
right, while 3-pants to the left, etc) for a PTZ IP (Pant, Tilt, and Zoom,
Internet Protocol) Network camera is a challenge. Such training is involving Effecti=
ve
Learning Strategies, Emerging and Innovative Research, and Internet Research
Forums. Instructors encourage existing and prospective faculty and students=
to
be involved and contribute in Assessing Submissions, Publications, Faculty
Development, Teaching, Research, Practice, Service, Awards, and Placement
streamline automation and SEO (Search Engine Optimization).
The
trouble with some of such governance risk assessment is that it requires ha=
nds
on experience and training, and that can get too expensive fast. Therefore, some organizations reco=
rd
traditional instructor led classes into DVDs and CDs, and repackage them for
self-study or supplements to instructor led classes. In addition they provide also Assessment CPE Video Podcasts and Blogs that are=
"Hands-on:"
but distance education, in form of Consulting, Publishing & Teaching
courses like Forensic Auditing, Expert Witness Testimony & computer
litigation support. In the co=
urse
of such training, they cover advanced specilized applications of familliar =
software,
such as, Microsoft® Office Accounting Computer Litigation Support,provided
by the American Accounting Association. This way students feel that they wi=
ll
be familiar with the content, and it will not be too difficult to use and
deploy.=
[8]
Most
auditors, and even computer
auditors are not familiar with certain new media technologies, that are
advancing at such high speed that even professionals in the area have troub=
le
keeping up with the technology. For
example, the technology that involves repurposing security surveillance vid=
eos
for instructional application maybe too overwhelming. Just dealing with the disk media i=
tself
is too much, who can tell the difference between all these disks (CD, CDR,
CD-RW,DVD-R, DVD-RW, DVD+RW, DVD+R, DVD-RAM, Blu-ray, High Definition, Stan=
dard
Definition, their file formats: .mpg, .mpeg, .avi, .mp3, .mp4, etc). For that reason, some organization=
s are
offering classes on "How to Use New Media and Technology to Repurpose
Classroom Instruction for the Accounting and Business Educator." These=
is
especially applicable to highly specialized area of study such as "Int=
ernational
Fraud and Forensic Accounting for continuity planning, Backup & disaster
recovery."[9]
where it is not easy to find it in the local community college or universit=
y.
For
better governance, sometimes, extra visualization has to occur for people to
fully understand the impact of poor governance and its risk, that companies
have to setup mock trials to make the point. Mock Trial are especially effectiv=
e in
semi legal environments like =
Forensic
Faculty training. This is a W=
WW
Marketplace, where the courts are picking the best experts around the
world. It is important to sim=
ulate
realistically what risk are we talking, by visualizing the legal outcomes i=
n a
mock trial. Together, the Jur=
y,
Judge & Attorneys simulate a Courtroom & Classroom applying
Instructional Technology Research & Service from the American Accounting
Association.[10]
Industry Specific Academia had to be invo=
lved,
like the Hedge Fund, an average accounting professor and auditor will have =
no
clue how to investigate financial derivative and swaps. Government &
Medical Shenanigans will confuse a lay person and even an untrained
professional will not be able to understand all the intricacies. Special controls have to deal with
problems like Plagiarism, Theft & Misrepresentation. Controls highlighting Red-flags
White-color Schemes, Scams, and Cons such as analytical scam scans should be
deployed to streamline internal audit work. Especially in some areas around the
world like Miami, and Latin America, Crooks Drugs & Human Trafficking b=
ecome
a common news in the local
press.
Such topics require some Advance Preparation, from both the instructor
and the audience. So frequent=
ly the
presenters will provide their email an=
d encourage
prospective participants to call the presenters about specific cases, artic=
les,
issues, or any relevant suggestions and/or materials, and/or ideas for
discussion and analysis during the workshop to presenters
Role Playing Forensic Accounting typically
requires a forensic accountant, a regular auditor will know very little abo=
ut
it. Likewise an Auditing Tax =
Expert
Witness will be Providing Testimony and Computer Litigation Support in spec=
ial
fraud cases such as "Barnard Madoff" ponzy schemes. As the CPE about "Teaching,
Services, Research and Development," by the American Accounting
Association Annual demonstrates. [11]
=
[12]
Tools which have not played a
major role in the auditor tool box, like Cell Phone Real Time Forensic Audi=
t,
are taking leading roles in special areas such as Tele-Medicine e-Bill Reco=
rds
over the WWW AV IP (World Wide Web Audio Video Internet Protocol) Network.<=
span
style=3D'mso-spacerun:yes'> Security Surveillance audit and Re=
connaissance
of PTZ (Pant, Tilt & Zoom) Cam Systems & CCTV (Closed Circuit TV) a=
re
no longer only in science fiction, but in the courts in Miami searching for=
the
money of more ponzy schemers. For
these kind of courses DVD-Recording of Repurposed Stand-Up Instructions for
Distance or Blended Education and CPE is a must, simply because nobody else
beside a hand-full of specialists around the world knows much about it. =
"This
is a study of cell phone real time auditing. To complement the traditional
after-the-fact auditing, this case study deals with real-time auditing.
Meaning, that the auditor watches the activities in real-time. It is using =
the
World Wide Web (WWW) internet instead of limiting the access to the intrane=
t;
adding profitable online distance learning," as the AAA suggest.
Specialties like "Health Care Forensic Information
Technology Networks of Expert (FITN) Witnesses" requires Teams Researc=
hing
Investigative Tax, Accounting and Auditing (FIA) Forecasts Archives of reco=
rds,
Testimony, Assessment, Publishing, and Multi-Media Consulting to figure out
what is going on, a regular auditor will not be sufficiently knowledgeable.=
As phony medical service providers=
bilk
the government for artificial limbs, that never existed and shut down the
operations every few weeks, it is very difficult for a regular auditor to
figure out what is going on, set up proper controls and deal effectively wi=
th
the situation. Auditing such a
business scenario requires knowledge of foreign languages, and cultures, no=
body
speak English, the accounting systems are very specialized to comply with
industry specific regulations, and the environment is very fluid. Today the business is here, and to=
morrow
it is gone with the money.
Managerial audit has to deal
more intensively with the legal and Compliance function, but deploy new
technologies that will minimize such costs. Such technologies include Real-Time
2-Way AV (Audio/Video) HD (High Definition) Recording Audit of Effective
Learning Strategies for Forensic IT Networks of Expert Witnesses Research t=
hat
Focuses on Investigative Accounting Testimony, & Computer Litigation
Support. Working with academi=
cs,
together they should be deploying more effective learning strategies (E=
LS)
that repurposes stand-up traditional classroom instruction AV (Audio Video)
surveillance recorded to a DVD, for real-time auditing, distance learning, =
CPE
courseware, as well as Tutor CDs and DVDs. As soon as the class is over, the
instructor's PC uploads the AV session to Google Video, and to an WWW
DVD-burner. The managerial au=
ditor
expose his teams and other related subsystems to such information without
raising costs, while improving continuing professional education, governanc=
e,
and risk control assurance.
IFRS,
GAAP, GAAS Forensic IT & GARM
"IFRS
(International Financial Report Standards) Compliant Real-Time" Audit =
requires
some special skills. The audi=
tor
has to be familiar with IFRS. Most
auditors, that have graduated from college more than 5 years ago do not even
know what IFRS stands for, let alone audit in an IFRS forensic
environment. Most US auditors=
are
familiar with GAAP and GAAS, which are quite different from IFRS. Therefore, special and effective
learning strategies for forensic it networks are necessary to conduct a pro=
per
audit, leading to functional auditing Governance Assurance Risk Management =
(GARM)
programs and control systems, as the AAA suggests. =
[13]
Summary, Conclusions and Implications
Summary
This manuscript reviewed way in which the managerial audit
function can draw upon other functions to assure better governance and mana=
ge
risk more effectively. The be=
st way
to accomplish this without draining the managerial audit function is by
collaborating with other functions such as the legal, accounting, operation=
al,
and most importantly the top management in the organization, while deploying
new technologies to keep it effective and efficient.
Conclusions
The managerial audit function will have to keep up with techno=
logy
and attain new technological skill and increase the collaboration with other
professionals that traditionally have not been integrated into the manageri=
al
audit activities. Such example
include litigation functions, including legal audit, and litigation
support. Multimedia functions=
that
can provide multimedia supplements to the traditional pencil, paper and
spreadsheet of the managerial audit toolbox.
Implications
The future of the
managerial audit function will most likely be much more diversified and
integrated into many more facets of the organization starting with top
management and the organizational goals and objecti=
ves
and ending with the bottom of the organization, and it most operational act=
ivities. The managerial audit function will=
cross
silos of organizational systems, providing multidisciplinary communication =
and
coordination to assure better and more ethical governance along with better
risk management.
* These are quotes from the online and offline
publications of the American Accounting Association (AAA) as the footnotes =
and
their respective URLs indicate.
*Appendix 1:
\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\
Rushinek, A. a=
nd
Rushinek, S. “Sarbanes Oxley Microso=
ft
Accelerator Forensic Accounting, Expert Witness Testimony, & Computer
Litigation Support Workshop”, American Accounting Association
Annual Meeting 2005, Saturday, August 4,2005, San Francisco, California,
sponsored by Teaching and Curriculum Section<=
/span>.
http://aaahq.org/AM2005/cpe/cpe02.htm
&m=
iddot; =
An International Meeting of
the American Accounting
Association
Description/Objectives:
Sarbanes-Oxley Microsoft Accelerator Forensic accounting workshop demonstra=
tes
how Accounting academics and practitioners can use Microsoft Share Point Te=
am
Services and Share Point Server to assist an internal audit team in
implementing, investigating, and improving compliance audit services. It
describes how to become an Accounting Expert Witness and how to provide Exp=
ert
Witness Testimony, with an emphasis on HIPAA (Health Insurance Portability =
and
Accountability), Sarbanes-Oxley, and Basel II Compliance Forensic Accountin=
g.
We will discuss
R&D for experienced expert witnesses, including the issues of dealing w=
ith
the forensic team of professionals. This workshop focuses on using forensic
accounting techniques in general, and providing Computer Litigation Support=
in
particular. The workshop objectives include helping experienced expert
witnesses to review their skills and upgrade them, while demonstrating to
prospective expert witnesses the nature of the work, its intellectual
challenges and financial opportunities and rewards. We plan to meet such
objectives, by lectures, role playing, demonstrations, and most importantly
active participation of the audience as well as discussions and arguments of
pros and cons of various issues.
Format/Structure:
DVDs for litigation support, including the pros and cons of different stand=
ards
such as DVD+/-RW/VR (Digital Versatile Disk, Read Write, and Video Recordin=
g),
DVD-RAM (Random Access Memory), HD (High Definition)-DVD, Blu-Ray DVD, DVD
Copying, dubbing, burning, and recording, focusing on the technical and leg=
al
facets.
Intended
Audience:
This study targets practicing and academic litigation and litigation support
team members, including lawyers, economists, accountants, auditors, doctors,
engineers, corporate executives, expert witnesses, plaintiffs and defendant=
s,
as well as students and others interested in the topic. This workshop will
review the financial opportunities for expert witnesses, fee structures,
relationship with the legal profession, opportunities for students that wan=
t to
specialize in the area of forensic accounting and litigation support, and/or
combine the study of accounting and law, and computer information systems.<=
o:p>
Presenters:
Sara Rushinek, University of Miami
Avi Rushinek, University of Miami
Sponsor:
Teaching and Curriculum Section
//////////////=
///////////////////////////////////////////////////////////////
Description/Objectives:
Assessment of accounting programs by national, international, or regional
organizations and Recruiting Candidates lends itself to computer automation.
Compliance with the EEOC and Sarbanes-Oxley, as well as CPA, CMA, CIA, CISA=
/M
Computer Preps, target Internet Publishing Video DVD/CD Recording, and
web-casting or multi-media streaming tools to be more effective and efficie=
nt,
and provide a more enjoyable experience. The focus of our current research =
is
in certification accreditation/reaffirmation efforts, which is getting
increasingly more complicated and demanding. The only way to master it quic=
kly
and efficiently is by some automated hands-on activities. What is assessmen=
t?
And what do regional accrediting agencies expect? Much like any assessment
activity, the evaluations and accreditation process involves: Developing an
assessment plan; Building and using measurement standards; Motivating
participants (existing and prospective faculty and students) to be involved=
and
contribute; Performance Evaluation Feedback; Risk Mitigation; Deficiency
Remediation Action; Revision of the assessment plan and recruiting streamli=
ne
automation.
Desc=
ription/Objectives:
Repurpose DVD-recorded lectures using new Blu-ray® and HD-DVD® in t=
he
classroom and CPE, for the CPA, CMA, CIA, CISA/M WWW certificate Preps.
Demonstrate download of the Microsoft Office Accounting, and upload the lec=
ture
on ITunesU®, Google Video®, and YouTube®. Review test automation
compliance with NASBA, AACSB, COSO, Sarbanes-Oxley, HIPAA, and Basel II.
Publish for students, alumnus, professionals, and the general public. Web c=
ast
using multi-media streaming tools to be more effective and efficient, and
provide a more enjoyable experience. Use the new Microsoft® Office 2007
Accounting, and Vista® involving Effective Learning Strategies, Emerging
and Innovative Research, and Internet Research Forums. Instructors encourag=
e existing
and prospective faculty and students to be involved and contribute in Asses=
sing
Submissions, Publications, Faculty Development, Teaching, Research, Practic=
e,
Service, Awards, and Placement streamline automation and SEO (Search Engine
Optimization).
Desc=
ription/Objectives:
The workshop deals with: E-Discovery Testimony, Accounting Corporate
Information Unauthorized Disclosure, Identity Theft, Money Laundering, Fraud
investigations, Office Accounting Cops & Robber Simulations, Phony Sales
& Fraud detections, Spreadsheet Database Research Tracking, Digital Med=
ia
Evidence CDs & DVDs, CYBER CRIME, Security ethical hacking anti-Virus
controls, Cell Phones & PDAs Evidence, Trade Secrets Alleged Theft,
Electronic Evidence Management. Threats Software & Hardware tool
Integration Scenarios Deposition Preps, Jury Deliberation Litigation
Arbitration & Mediation Industry Specific Academia, Hedge Fund, Governm=
ent
& Medical Shenanigans, Plagiarism, Theft & Misrepresentation Contro=
ls
Red-flags White-color Schemes, Scams Cons Crooks Drug & Human Trafficki=
ng
Certification Qualification Monitor Confessions Boiler-Plate Rooms, Schemes,
Counsels, Judges, & Lawyers Gone Wild (900)Sue-U2.com Foreign Offshore
Banking, Tax Avoidance Evasion, & Wealth Management PI Family Divorce
Real-estate Stock-Market Litigations Hired Guns Cross Examination Structured
Settlements.
Adva=
nce
Preparation:
Email and or call presenters (arush@miam=
i.edu,
arushine@aol.com, (305) 666-7890) a=
bout
cases, articles, issues, or any relevant suggestions and/or materials, and/=
or
ideas for discussion and analysis during the workshop to presenters. Dr. Avi
Rushinek, University of Miami, Accounting Department, Jenkins 421, C. Gable=
s,
Fl, 33124 USA (Run)Air-Webs/Phone (Cell) U. Miami, 5250 University Drive,
C.I.S. Dept. Jenkins 421, C. Gables, Fl, 33124 (786)247-9327/7466 (Cell) Ac=
c.
Dept. 314 Jenkins, UM, Coral Gables, Fl, 33124, USA or 1205 Mariposa Ave. #=
208,
Coral Gables, Fl, 33146.
http://www.onafree.com/defa=
ult.aspx
http://drjd.net/default.aspx
Pres=
enters:
Avi Rushinek, University of Miami
Sara Rushinek, University of Miami
Desc=
ription/Objectives:
The workshop deals with: Rogue Wireless Access Points, Internal Threat
Management, Vulnerability Exploits Web, Intrusion Detection, Eaves Dropping=
AV,
Surveillance Recording Audit, On Demand Live Consulting, Internet Access Da=
ta
points, Consumer Electronics Gone Wild, IT (Information Technology) Governa=
nce,
Log Forensics Stealth Regulatory Compliance Audit Trails, Mobile Device Dig=
ital
Consumer Electronics Transcription Stenography, voice to text automation, C=
ell
Phone Video Cam Justice & Court TV Shows Camera Imaging Distribution,
Lawsuit Incident Response, WWW Network URL TCP/IP HTTP, Stealth Data
Intelligence Office Accounting Information Systems Demos "But-for/If&q=
uot;
Analytics Metrics Trap Door Trojan Horses, Spying & Due Diligence
Enterprise Risk & Damage Assessment Market Rates & Charges Malpract=
ice
& Business Valuation "Lost Profits" Board of Directors Litiga=
tion
Service Confessions Acting Telling a Story Sound-bite Tips & Tricks
Interrogate Terror Home-land Security Bribery Black-mail Corruption & W=
here
is the Money Laundering.
Adva=
nce
Preparation:
Email and or call presenters (arush@miam=
i.edu,
arushine@aol.com, (305) 666-7890) a=
bout
cases, articles, issues, or any relevant suggestions and/or materials, and/=
or
ideas for discussion and analysis during the workshop to presenters. Dr. Avi
Rushinek, University of Miami, Accounting Department, Jenkins 421, C. Gable=
s,
Fl, 33124 USA (Run)Air-Webs/Phone (Cell) U. Miami, 5250 University Drive,
C.I.S. Dept. Jenkins 421, C. Gables, Fl, 33124 (786)247-9327/7466 (Cell) Ac=
c.
Dept. 314 Jenkins, UM, C. Gables, Fl, 33124, USA.
http://www.onafree.com/defa=
ult.aspx
http://drjd.net/default.aspx
Pres=
enters:
Avi Rushinek, University of Miami
Sara Rushinek, University of Miami
Board 3 Cell Phone Real Time Forensic Audit of
Tele-Medicine e-Bill Records over the WWW AV IP Network Security Surveillan=
ce
Reconnaissance PTZ Cam Systems, CCTV & DVD-Recording: Repurposed Stand-=
Up
Instructions for Distance or Blended Education and CPE
Presenters: Avi Rushinek, University of Miami; Sara Rushinek,
University of Miami
Description: This is a study of cell phone re=
al
time auditing. To complement the traditional after-the-fact auditing, this =
case
study deals with real-time auditing. Meaning, that the auditor watches the
activities in real-time. It is using the World Wide Web WWW internet instea=
d of
limiting the access to the intranet; adding profitable online distance
learning.
Board 10 Health Care Forensic Information Technology
Networks of Expert (FITN) Witnesses Teams Researching Investigative Tax,
Accounting and Auditing (FIA) Forecasts Archives of Testimony, Assessment,
Publishing, Teaching, Service, and WWW Multi-Media Consulting
Presenters: Avi Rushinek, University of Miami; Sara Rushinek,
University of Miami
Description: Emerging and Innovative Research
highlights promising Forensic IT (Information Technology) Networks of Expert
(FITN) Witnesses Research that focuses on Forensic Investigative Accounting=
and
Auditing (FIA) research ideas. Authors describe their work in progress
soliciting others to research it and help them.
Board 19 IFRS Compliant Real-Time 2-Way AV (Audio/Vide=
o)
HD (High Definition) Recording Audit of Effective Learning Strategies for
Forensic IT Networks of Expert Witnesses Research that Focuses on Investiga=
tive
Accounting Testimony, & Computer Litigation Support
Presenters: Avi Rushinek, University of Miami; Sara Rushinek,
University of Miami
Description: Effective Learning Strategies (E=
LS)
that repurposes stand-up traditional classroom instruction AV (Audio Video)
surveillance recorded to a DVD, for real-time auditing, distance learning, =
CPE
courseware, as well as Tutor CDs and DVDs. As soon as the class is over, the
instructor's PC uploads the AV session to Google Video, and to an WWW
DVD-burner.
Rushinek, A.=
and
Rushinek, S. “Managerial
auditors mixed cost forecasting assumption departure error estimates for
litigation and professional liability risk reduction: the electronics
industry”, MANAGERIAL AUDITING JOURNAL, Vol.12 No. 6, 1997.
·
http://www=
.emeraldinsight.com/10.1108/02686909710180643
[3] Rushinek, A. and Rushinek, S. "Evaluating Asset Safeguardin=
g and
Data Integrity in the EDP Audit", MANAGERIAL AUDITING JOURNAL, Vol. 4,=
No.
2, 3‑6, 1989.
[4]
Rushinek, A. and Rushinek, S. "Using Experts for
Detecting & Litigating Computer Crime", MANAGERIAL AUDITING JOURNA=
L,
Vol. 8, No. 7, November, 1993, 19-21. http://www=
.emeraldinsight.com/Insight/viewContentItem.do;jsessionid=3DF7DE1EFC3607A13=
34B38FFDD83ADDA46?contentType=3DArticle&contentId=3D868184 http://www.emeraldinsight.com/10.1108/02686909310046862<=
/span>
[5]
Rushinek,
A. and Rushinek, S. “Sarbanes Oxley
Microsoft Accelerator Forensic Accounting, Expert Witness Testimony, &
Computer Litigation Support Workshop”, American Accounting
Association Annual Meeting 2005, Saturday, August 4,2005, San Francisco,
California, sponsored by Teaching and Curriculum
Section.http://aaahq.org/AM2005/cpe/cpe02.htm
=
[6] Rush=
inek,
A. and Rushinek, S. “Assessment Automation Software for Accounting,
Teaching, and Recruiting Programs”, American Accounting Associat=
ion
Meeting 2006,August 6, 2006, Washington, D.C., sponsored by Teaching and
Curriculum Section. http:=
//aaahq.org/AM2006/cpe/cpe01.htm
http://aaahq.org/pubs/AE=
N/2006/AM2006.pdf
[7]
Rushin=
ek, A.
and Rushinek, S. “Audited Google Vid=
eo
Professors' e-Store Pod-Casts: How to Teach, Service & Research using W=
WW
Assessment DVD of Microsoft® Office Accounting Technologies for the
Wireless Classroom,” American Accounting Association Annual
Meeting 2007, August 4, 2007, Chicago,
Illinois, sponsored by Teaching and Curriculum Section. http://aaahq.org/am2007/cpe/=
cpe03.htm
[8]
Assessment CPE Video Podcasts and Blogs "Hands-on:" Consult,
Publish & Teach Forensic Auditing, Expert Witness Testimony &
Microsoft® Office Accounting Computer Litigation Support," Amer=
ican
Accounting Association Annual Meeting 2007, Saturday, August 4, 2007, Chica=
go,
Illinois, sponsored by Teaching and Curriculum Section. http://aaahq.org/am2007/cpe/=
cpe08.htm
[9]
Rushin=
ek, A.
and Rushinek, S. "How to=
Use
New Media and Technology to Repurpose Classroom Instruction for the Account=
ing
and Business Educator" 2008 International Fraud and Forensic Accounting
Education Conference, May 9, 2008, Las Vegas, Nevada http://www.docstoc.com/docs/5525868=
/2008-International-Fraud-and-Forensic-Accounting-Education-Conference<=
/span>
[10]<=
/a> Rushinek, A. and Rushinek, S. "Mock Trial & Forensic Fa=
culty WWW
Marketplace, Jury, Judge & Attorneys Courtroom & Classroom
Instructional Technology Research & Service," American Accounting
Association Annual Meeting 2008, Anaheim, California, CPE Session 2: Saturd=
ay,
August 2, 8:00 AM 11:00 AM, sponsored by Teaching and Curriculum Section. http://aaahq.org/AM2008/cpe/=
cpe02.htm
[11]
Rushin=
ek, A.
and Rushinek, S. "Role P=
lay
Forensic Accounting, Auditing & Tax Expert Witness: Providing Testimony=
and
Computer Litigation Support Teaching, Services, Research and Development,&q=
uot;
American Accounting Association Annual Meeting 2008, Anaheim, California, C=
PE
Session 11: Saturday, August 2, 1:00 PM - 4:00 PM, sponsored by Teaching and
Curriculum Section. http:=
//aaahq.org/AM2008/cpe/cpe11.htm
[12]<=
/a> Rushinek, A. and Rushinek, S. "How to Use Cases, Role Playi=
ng and
Mock Trials in the Classroom: The Role of the Accounting and Business Educa=
tor
with the Aid of New Computer Media," American Accounting Association
Annual Meeting 2008, August 6, 2008, Anaheim, California http://aaahq=
.org/TeachCurr/newsletters/Summer2008.pdf
=
[13]
11-12-9_11pm_mht_MANAGERIAL AUDITING
GOVERNANCE ASSURANCE RISK MANAGEMENT, REAL-TIME COUNTER PARTY SURVEILLANCE
AUDIT TOOLS REPURPOSED VIDEO
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