Audit Process and Types

The Audit Process

Planning and Entrance Meeting

During planning, the auditor gathers background information about the audit topic, determines the audit objectives and methodology, and develops an audit program. This program outlines the procedures for identifying areas to examine, questions to ask, and documents to review.

At the entrance meeting, the auditor discusses the audit objectives, scope, timeline, resources needed, and how results will be communicated with the auditee.

Fieldwork and Status Meetings

The evaluation phase, or fieldwork, involves the auditor assessing internal controls and compliance by interviewing key personnel, reviewing departmental records and processes, and testing a sample of transactions.

Throughout fieldwork, the auditor holds status meetings with the auditee to address initial observations and document requests, allowing for clarification and additional documentation.

Post-Fieldwork and Exit Meeting

After fieldwork, the auditor drafts a report with observations and corresponding recommendations, then shares it with the auditee for discussion at the exit meeting.

During the exit meeting, the auditee can propose changes, which are then incorporated into the draft report. The auditor also requests written responses to the recommendations.

Audit Report and Follow-up

Typically, the auditor follows up with the auditee to ensure recommendations and corrective actions are effectively implemented and results are achieved.

Types of Audits and Reviews

Compliance

This audit assesses whether the university and its affiliates comply with applicable laws, regulations, and policies, including federal and state laws, Trustee policies, Chancellor's Office directives, and university procedures.

Consulting

This review, requested by campus management, provides a proactive, independent assessment of identified concerns or process improvements. The auditor maintains independence by not assuming management responsibilities.

Financial

This audit assesses the fairness, accuracy, and reliability of financial transaction accounting and reporting. CSUSM's external financial auditors, KPMG, perform this audit in coordination with Business & Financial Services.

Internal Control

This audit evaluates the university and its affiliates' internal control systems across key business activities (e.g., cash handling, accounts receivable, procurement, accounts payable, fixed assets, equipment, and HR/payroll, etc.) to ensure they function as intended and effectively address operational risks.

Investigation

This review investigates allegations of fraud, waste, abuse, or improper activities to determine their validity and prevent future occurrences.