Audit of Outsourced Functions

Focus & Features:

As businesses focus more on core competencies, more and more companies have turned to outsourcing non-core functions to drive down operational costs. With the benefits of outsourcing comes the risks of lesser process control and the challenges of governance. The course is intended to provide a basic understanding of outsourcing trends and risks. It also aims to provide a general controls framework for approaching third party and governance organization audits including audit tools and techniques. It also includes a discussion of special considerations for commonly outsourced functions and activities. The course is targeted towards both auditors and non-auditors with third party governance responsibilities. The methodologies include a combination of lectures, case studies and group discussions to provide a comprehensive learning process.

What You Will Learn

The program will enable participants to learn and/or apply the following:

Background & Evolution of Outsourcing

• Key Definitions
• Outsourcing Impact on Controls
• Outsourcing as Part of the Audit Plan
• IIA Practice Guides on Outsourcing
• Outsourcing Risks & Challenges
• Building Vendor Relationships
• Outsourcing Agreement Steps

Internal Audit Value to Outsourcing

• Outsource Audit Process
• Internal Audit Value Add & Insight Delivery to Outsourcing

Enterprise Outsourcing and Business Risk Assessment

• COSO Enterprise Risk Management Model
• Strategy Risk
• Feasibility Risk
• Financial Risk
• Transactional Risk
• Transition Risk
• Optimization & Transformation Risk
• Termination & Renegotiation Risk

Offshoring Risk Factors

• Special Considerations for Offshoring Agreements

Assurance Reliance on Others

• Assurance Provider Experience Evaluation
• Principles in Determining Reliance
• Determining Reliance in the Audit Process

Risk Identification Process

• Outsourcing Implementation & Controls
• Advantages & Disadvantages of Outsourcing
• Outsourcing Decision-Making Considerations
• Risk Identification Best Practices

Outsourcing Contracts

• Areas Requiring Due Diligence
• Contract Creation
• Right to Audit Clause

Establishing Controls

• IIA Practice Guide: Auditing External Business Relationships
• Business Risks of EBRs
• Dealing with Fraud

The Audit Process

• The Outsource Audit Process
• The Audit Team

Special Topics

• Emerging Issues
• Outsourcing Trends
• Case Studies of Successful Outsourcing
• Sample Audit Program
• Special Considerations for Different Types of Outsourcing Relationships