TIAPS Module 1 Audit and Assurance workbook

A.2 Public Sector Governance
IIA Internal Audit Competency Framework
Organizational Governance:
General Awareness: Describe the concept of organizational governance.
Applied Knowledge: Detect risks related to the organization’s governance policies,
processes, and structures.
Expert: Recommend improvements to the organization’s governance policies, processes,
and structures. 1
Internal audit adds value to its client organization when, among other things, it “strives to
offer ways to enhance governance.” 2 Governance can be understood in general terms as the
process of governing and is broadly about leading and controlling. It is defined by The
Institute of Internal Auditors (IIA) in the glossary of the International Professional Practices
Framework (IPPF) as:
The combination of processes and structures implemented by the board to inform,
direct, manage, and monitor the activities of the organization toward the achievement
of its objectives. 3
“Board” is used by The IIA to refer to the “highest level governing body” for an entity,
identifiable as the most senior decision-making authority. Public sector boards can take
many forms and “governing body” or alternatively “governing authority” is a more common
general term. Some government departments or ministries have a clearly defined board
whose membership may also include representatives of the private sector and civil society.
In a municipality or regional body, typically the council is the governing body in which the
mayor may act as both the equivalent of the chairman of the board and the chief executive
officer (CEO). In other situations, there is an executive director or manager who heads up
operations while the mayor is more of a political figurehead for the city. Generally, in public
entities where there is no immediately recognizable board or governing body, then governing
responsibilities may be assumed by one of the following:
• Head of the organization (minister, etc.) (i.e., a single person).
• External oversight committee which could take different forms (e.g., parliamentary
committee, government committee, committee represented by different ministries).
• Oversight by line ministry or a superior organization.
1
Internal Audit Competency Framework, The IIA, 2022.
2
Standard 2000 – Managing the Internal Audit Activity, International Professional Practices Framework, The IIA, 2016.
3
The International Professional Practice Framework, The Institute of Internal Auditors, 2016
9