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Less Than One-Third of Internal Auditors Fully Involved In State Examination Process

CHICAGO (January 18, 2018) – A flash poll conducted by Baker Tilly Virchow Krause, LLP (Baker Tilly) indicates only 30 percent of internal audit professionals in the insurance industry are fully involved with setting up interviews, meetings and examination requests during their state examination process.

“First and foremost, what makes internal audit’s role during the examination successful is setting up a planning meeting with all parties involved in the examination”, John Romano, CPA, CFE, CIA, senior manager in Baker Tilly’s risk advisory practice, said. “By conducting a kickoff meeting with internal audit and the examination team at the beginning, internal audit can share their view on areas of risks, risk assessment processes, Model Audit Rule and/or SOX approaches, and overall entity wide audit coverage. The initial meeting helps to facilitate the state examiners’ understanding of risks and controls, ultimately making the examination more efficient and internal audit’s role more valuable.”

Baker Tilly recently held an educational webinar, “Internal audit: Maximizing your role in the NAIC state examination process,” to assist insurance organizations in maximizing the value internal audit can provide in risk focused examinations. Joining Romano during the webinar was Todd Heine, CPA, CGMA, CIA, CLU, ChFC, internal audit director at American Financial Group. Heine shared his insights about the importance of working with the examination team in advance to prepare executives for interviews and other steps to make the examinations run smoothly.

The webinar presenters discussed:

  • Identifying and recognizing how the state regulators assess and evaluate the internal audit function during an examination;
  • Analyzing and planning for internal audits role prior to the start of an examination; and  
  • Options on how internal audit can add value during the examination process.

Presentation slides and a recording of the webinar are available at bakertilly.com/insights/internal-audit-maximizing-your-role-in-the-naic-state-examination-process/.

About Baker Tilly US, LLP (bakertilly.com)

Baker Tilly US, LLP (Baker Tilly) is a leading advisory, tax and assurance firm whose specialized professionals guide clients through an ever-changing business world, helping them win now and anticipate tomorrow. Headquartered in Chicago, Baker Tilly, and its affiliated entities, have operations in North America, South America, Europe, Asia and Australia. Baker Tilly is an independent member of Baker Tilly International, a worldwide network of independent accounting and business advisory firms in 145 territories, with 34,700 professionals. The combined worldwide revenue of independent member firms is $3.6 billion. Visit bakertilly.com or join the conversation on LinkedIn, Facebook and Twitter.