Impact of shared services on Internal Audit

Report
Impact of Shared Services on
Internal Audit
Deryck Fuller, Mike Cappetta,
Melissa Paulson
October 24, 2013
Agenda
•
•
•
•
•
Our Audit Universe
Risk Assessment Process
Case Studies
Benefits of Shared Services
Keys to success
MGM Resorts International – A Brief History
MGM Grand:
The City of Entertainment
1993
MGM Grand- Darwin, Australia
ACQUISITION 1:
1998
New York
New York
MGM Grand- Detroit
Whiskey Pete’s
Primm Valley
ACQUISITION 2:
Buffalo Bill’s
City Center
2000
Bellagio
The Mirage
Boardwalk
Treasure
Island
2009
Beau
Rivage
ACQUISITION 3:
Mandalay Bay
2005
Luxor
Excalibur
Gold Strike
Nevada Landing
Golden
Nugget
Golden
Nugget –
Laughlin
Monte Carlo
Colorado Belle
Edgewater
Gold Strike Tunica
Circus Circus
Slots-A-Fun
3
1999
Circus Circus Reno
Rail Road Pass
- Divested
1995
Risk Assessment Process
• Company Wide Risk Assessment
• Business Process Risk Assessment
Risk Assessment Process
• How often do you perform risk assessments?
• How do you gain comfort with controls over
financial reporting by testing a single process?
• How do you determine business units to test
in a shared services environment?
• How do you determine sample selections in a
shared services environment?
Key Questions for Shared Service Audits
• Does my audit universe need to be redefined? How can I better
define my audits in the new environment?
• How should I reassess my audit strategy on an ongoing basis?
• Do the controls now reside at the SSC or are they still in the
business units?
• How much coverage can I get as a result of auditing at the center?
• Do I need to audit only at the SSC?
• How does an SSC affect sample size and sample selection when one
moves from a decentralized environment to a shared environment?
• Are the processes and templates used across the SSC consistent?
Do work-arounds proliferate?
• Can I use automation in the audit process more effectively now
that I am auditing in an SSC environment?
Source : PWC
Business Process Audits (Case Studies)
• Accounts Payable
• Revenue Accounting
• General Accounting
Accounts Payable
• Do the controls now reside at the SSC or are
they still in the business units? Do I need to
audit only at the SSC?
• How much coverage can I get as a result of
auditing at the center?
• Are the processes and templates used across
the SSC consistent? Does this impact sample
size?
Revenue Accounting
• Do the controls now reside at the SSC or are
they still in the business units?
• How much coverage can I get as a result of
auditing at the center?
General Accounting
• How much coverage can I get as a result of
auditing at the center?
• Are the processes and templates used across
the SSC consistent?
Benefit of Shared Services
General Accounting
1,600
1,400
1,347
1,200
Hours
1,000
1,064
800
600
647
400
449
327
200
2008
2009
2010
Year
2011
2012
Keys to success
• Understand new technologies implemented
• Add value by identifying process
improvements
• Early involvement
– Steering committee
– Milestone reviews
• Reassess audit strategy on an ongoing basis
• Don’t fall into the SALY trap
Thank you!

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