San Gabriel Valley Chapter

The Bottom Line January 2011 Volume 3 ,Issue 2 Inside this issue: PRESIDENT’S CORNER

President’s Corner 1 Happy have planned in the coming Thanks for your Upcoming Events 2 New months. continued support and Year! membership in the IIA The very essence of our San Gabriel Valley. Your Attendance 2 chapter success rests upon Counts! the dedication and Please attend our local January 19th. Flyer 3 commitment each of you meetings or seminars to The planning is underway offer to the profession. make valuable for another successful Chapter Business 4 connections with fellow year! One of the amazing As an audit professional, I Internal Audit benefits of chapter appreciate the networking professionals and to November 2010 CAP 4 membership is taking at each meeting to become share information. If Report advantage of the better acquainted with there is anything we can learning opportunities you. be doing to better serve From Our Members 5 through professional your needs please let networking and quality I am continually amazed at Where in San Gabriel 6 me or one of the officers seminars. the enormous support Valley each of you provides in know. We had a whirlwind start helping our chapter remain

Job Opportunities 6 to the year with the 2010 the very success that it is! Western Regional Sangeeta Patel, MSc, Thank you for all the hard From TheIIA.org 6 Conference, September CPA, CIA roundtable luncheon work, support and More Chapter News 7 meeting, October commitment by the Board IIA San Gabriel Valley luncheon meeting and of Governors, Officers, and Chapter President Committee members to December holiday achieve the gold status Board Members and 8 luncheon. In addition, Officers we had a 2 day Fraud once again this year. This Seminar. I hope that you will be IIA San Gabriel Institute of Internal Auditors Valley’s 7th gold we only San Gabriel Valley Chapter have enjoyed the year so far and look forward to need 3 more gold status to PO Box 1532 achieve platinum status. Sierra Madre, CA 91025 the many events that we Your Attendance Counts Hope to see you at the next meeting. Upcoming Events Internal audits are conducted all over the Susan Egerman, Membership Chair WEDNESDAY San Gabriel Valley in diverse January 19th. organizations that vary in purpose, size, From: http://www.theiia.org/intAuditor/ 11:30 – 1:00, Pasadena’s complexity, and structure. While fraud-findings/ Women’s City Club differences may affect the practice of The Case of the Embezzling CEO Chapter Luncheon internal auditing, SGV Chapter internal KPMG audit organizations conform to the same ITWorld re ports that the former chief Data Analytics IIA Standards. The Standards provide a information officer at a U.S. automobile framework for performing audits and are processing company has been sentenced 2-Day Seminar important to our success as internal to prison for embezzling US $500,000 by Day 1—Ethics & Regulatory auditing professionals. faking expense reports and reselling Requirements for CA CPA (6 company equipment. The man was also One of the primary goals of our Chapter is hours) (Subject to change) sentenced in 1996 for stealing US to help our members fulfill their Day 2—Performance $200,000 while managing the Indiana Measures (8 hours) professional responsibilities. At our SGV audio shop. Time & Place: TBD (please Chapter monthly meetings we share check Events in our Website knowledge and information about the Lessons Learned for more information) internal auditing, the Standards, and This real-life situation reinforces the WEDNESDAY professional best practices. We provide importance of conduction criminal February 16th. members with professional training and background checks, particularly on people 11:30 – 1:00, Pasadena’s development opportunities that address responsible for handling cash or Women’s City Club current and emerging trends. receivables. It also demonstrates that not Chapter Luncheon This year our Chapter will be promoting all of the fraud triangle conditions – KPMG pressure, rationalization, and this important goal by rewarding those opportunity—need to be present for fraud Contract Compliance who attend monthly meetings with a to occur. For example, there was no WEDNESDAY raffle opportunity. Every time you attend evidence of rationalization in this March 16th. a monthly meeting, your name will be situation. In fact, the perpetrator 11:30 – 1:00, Pasadena’s entered into the raffle for two Kindles. appeared to know that what he was doing Women’s City Club Each Kindle will contain a copy of our IIA was wrong. There were no obvious signs Chapter Luncheon Standards and professional practices. of financial or other pressure (e.g. Shawn D. Stewart—Grant The more times you attend, the more gambling problems or medical costs). Thornton chances you will have to win a Kindle. However, when controls are weak, some MARCH Networking Event The raffles will be held at our March people cannot refrain from taking (TBD) Networking (TBD) event and the June advantage o the situation. Risk Based Auditing Luncheon meeting. April 2011 Auditors may not be able to address the rationalization or pressure components of Back to Basics 3-day seminar A big Thank You goes to our sponsor, Robert Half, for providing one of the the fraud triangle, but they can reduce the TBD (check our website!) Kindles. opportunity. By verifying the control framework, internal auditing can reduce the opportunities available for fraud. Page 2 Page 3 CHAPTER BUSINESS September Meeting $20.6 billion bank with 133 branches in detection and prevention of fraud. By Jan Biferno the , two branches in Hong Our September meeting was attended by Kong and a subsidiary bank in China December Meeting over 30 people, and was an interesting The Wednesday, December 1st change in presentation format. Instead of October Meeting meeting focused on Leadership, the usual single presenter, we had two The Wednesday, October 20th meeting and was presented by Jill and Steve speakers in a lively discussion on the audi- was presented by David Merriam, Senior Morris from Choice Works, Inc. This tor of the future as our guest speakers re- Manager at PriceWaterhouseCoopers, was a fun meeting, and it gave at- sponded to questions posed by Ruthe Hol- LLP. The program topic: Increasing Prof- tendees a chance to focus not only den as the moderator. In addition to ques- its and Mitigating Risk: Assessing vulner- on the negative, but also in the posi- tions posed by Ruthe, the speakers re- ability to fraud, corruption, and other mis- tive side of any situation. sponded to questions from the audience. conduct, was successfully addressed by Our two guest speakers were Megan Scott- the speaker. January Meeting Kakures and Albert Lau. Megan Scott- The Wednesday, January 19th. Data Kakures is vice president of Edison Interna- November—Fraud Symposium Analytics Meeting will be presented tional (EIX) and Southern California Edison The two-day seminar at Metropolitan by Kristinne Uy Cañas, and Daniel (SCE) and general auditor of EIX, SCE and Water District of Southern California fo- Hu, from KPMG. Edison Mission Group. She has held this cused on providing quality professional They will talk about the require- position since April 2007. She is the head education on fraud related issues, and it ments, Methods and tools, and will of the 80 person Audit Services Depart- gave participants a chance to network present a Case Study. ment, which is comprised of three divisions with other professionals; all at a reason- – financial and contract, operating and con- able price. The different tracks covered a Chapter Members, join us and sulting, and information technology. Albert variety of topics ranging from Fraud in stay in touch with the IIA SGV Lau is currently the Chief Audit Executive the Accounting Profession to Financial group on of East West Bank headquartered in Pasa- Crimes and Embezzlement where the

dena, California. East West Bank is a attendees learned how to assist in the

NOVEMBER 2010 CAP REPORT

By Rey Bejerano 2010-2011 2009-2010 Disneyland was 737 for SGV members and 486 for non IIA

members. Additionally, the I am pleased to present a Service to Members 995 1,715 chapter’s share in the profit progress report for 2010-2011 Service to Profession 359 306 was approximately $12,000. Chapter Achievement Program Chapter Administration 208 325 The 6 months activities earned (CAP). The total CAP points the chapter 1,562 points and Total 1,562 2,346 earned for the six months officially the SGV Chapter ended November 30, 2010 are has now attained Gold status. shown below: The 2010-11 activities included a regular monthly Thank you to all the meetings; planning meetings of the Officers and committee chairs and Committee Chair; Western Regional Conference volunteers who help achieve held in Disney and a 2 day Fraud Symposium. The the gold status 7 straight year. Chapter’s share for the Western Regional Our goal is to attain platinum. Page 4 Conference held September 19 to 22, 2010 in From Our Members Tips for using ACL™ and Time, (4) Financial, (5) Logical, (6) Mathematical, (7) Miscellaneous, and (8) Many of us use ACL as an analysis tool, and are always String Access Functions. looking for ways to simplify the day-to-day analysis when a script is not readily available. This article is for You can view all the functions in the Expres- those of you who are still not quite the experts, but are sion Builder. Click the Functions drop-down past the beginner phase. You must have worked with list to select the category you want to view. ACL in order to understand some of the jargon that I will When building a function, remember to use single or be using in the next tips, please keep in mind that if you double quotes for characters (‘ ’ , “ ”) and back do not have an ACL project open, these tips will not quotes for dates ( ` ). You do not need to use quotes make much sense. for numbers. To get the total of a column: When looking for duplicates in a column, but the Highlight the column and click on the Total fields have a variety of symbols and/or spaces, cre- ate a CLEAN expression by getting rid of spaces and/ or extra symbols: CLEAN( string Icon <,extra_invalid_characters> ). To filter records without having to type the formula, For example, you are looking for duplicate use Quick Filter: invoices but the invoices have extra sym- Click on the record you wish to apply the bols, such as * #. The expression would read filter, keep the cursor in the record, right CLEAN (INVOICE_NO, “*#_- ”) Notice the click and click on the desired Quick Filter you space after the dash, the expression will also wish to apply: Equal, Not Equal, Greater get rid of spaces in the field. If the invoice Than, Greater Than or Equal To, Less Than, number was “MA351R *”, the created one Less Than or Equal To. will be “MA351R”. Now you can use the du- Say you need to verify the net pay column: plicate function to look for duplicates in the newly created column. Highlight a column, then right click, click on Add a column, click on Expr, give the column Looking to summarize your data and do not feel like a name in Save As (C_NetPay) and create the creating a Pivot table in Excel? It is easier in ACL: expression, for example Gross_Pay - use the Summarize function under Analyze in the Tax_Amount Click on Okay. You can verify menu and you can summarize on a field, you can the Calculated column you just created is even total the records, and add other fields to your the same as the existing one by creating a summary. True or False expression. Again, Add a Col- umn, click on Expr, Save As (give the column These are just a few tips to obtain faster results, and a name) and create the expression, for ex- making your work easier when using ACL. Remember ample C_NetPay = Net_Pay. You will get a T you can always refer to the Help icon if you have doubts or F result which you can filter to find out if about any functions, as well as access the ACL User Fo- any record is False. rum in the ACL website, the chances that there is a post- To create more complicated expressions (to use con- ing there already with what you are looking for is very ditions), create the expression in the Table Layout. high, or you can post your question and somebody will Get familiar with the Function Categories. ACL func- answer it almost right away. tions are divided into eight categories to identify their purpose: Claudia Casasola (1)Bit/Character, (2) Conversion, (3) Date Senior Auditor LACMTA

This Article was first published by ALGA in its Fall 2010 AudiTechie Column Page 5 WHERE IN SAN GABRIEL VALLEY?

of visiting historic ancient sites in Egypt or climbed 1,300 feet to the White City. From Greece. There are other hikes in the San the White City, guests could board the Gabriel’s that visit historic spots, but none Alpine Division of the Railway compare to . for a 4-mile winding trolley ride to the Mt. Lowe Tavern. Through a series of fires The complex was and windstorms, ―The White City‖ was birthed from the visions of Civil War destroyed; Echo Mountain House in 1900, balloonist and inventor, Professor then all but the observatory in 1905, and Thaddeus S.C. Lowe and engineer David then the observatory in 1928. The incline J. McPherson. Their collaborative efforts was abandoned in 1938. produced Southern California’s must-visit Echo Mountain attraction, drawing more than three million For more info, visit http://www.mtlowe.net/ This month’s picture is of the Echo visitors from 1896 to 1936. Echo Mountain (3207’), known as ―The White City,‖ was Next edition we will be talking about: Mountain (via the Sam Merrill Trail in the heart of the resort with its two hotels – Can you identify where in San Gabriel The start of this trail starts at Altadena) elegant Echo Mountain House and The Valley this picture was taken? the head of in Altadena Chalet—observatory and small zoo. Other and climbs 2.7 miles to the historic ruins infrastructure included a powerhouse, of Professor Lowe’s famous White City. machine shop, reservoir, and the world’s En route you are treated to amazing most powerful searchlight. vistas of the urban sprawl while climbing steadily through rich, mature To reach Echo Mountain, guests rode a chaparral with views into the rugged trolley up Rubio Canyon (east of Echo Los Flores Canyon and the surrounding Mountain) to the terminal of the great mountains. When you reach Echo incline . They then boarded ―White

Mountain, exploring the ruins has a feel Chariots‖ for a breathtaking ride that

JOB OPPORTUNITIES To post job opportunities in the Newsletter, please e-mail information to Claudia Casasola at [email protected] IIA Award Call for Nominations recognition during the conference. know that The IIA’s curriculum Open The deadline for nominations is development team recently released an February 24, 2011. enhanced version of the highly-rated January 5, 2011The Institute of Internal The Call for Nominations can be seminar, Audit Report Writing. This Auditors is now seeking nominations of downloaded at http://www.theiia.org/ updated course covers the same qualified candidates to be considered for theiia/about-the-institute/awards/ important content it always has, now in a the highest awards given by The Institute: individual-awards If you would prefer format that better facilitates learning and The Bradford Cadmus Memorial Award; to receive the Call for Nominations better equips you to deliver impactful, high The Victor Z. Brink Award for as an attachment, please request a -quality reports to your clients. Distinguished Service; and The Lifetime copy from Lori Gagnon at Make improved report writing one of your Achievement Award. Recipients of these [email protected]. 2011 New Year’s resolutions and register today! awards will receive complimentary Upcoming offerings include a four-session registration and travel arrangements for the IIA Revises Audit Report instructor-led virtual offering beginning on International Conference in Kuala Lumpur, Writing Seminar January 18 (2:00 – 5:20 p.m. ET); and a Malaysia in July 2011, as well as January 4, 2011 two-day course on February 17 – 18 (9:30 special If writing audit reports is part of – 5:00 p.m. ET) in Houston. Page 6 your job, then you’ll be thrilled to More Chapter News Presentation– Internal Audit in the Spot- providing assurance light that internal controls By Jason Nishiyama, Academic Relations adequately mitigate Last month I was invited to speak to a group of busi- risks, governance proc- ness students at Loyola Marymount University. The esses are effective and purpose was to speak about the internal audit pro- efficient and organiza- fession. My presentation was titled Internal Audit in tional objectives are the Spotlight and included a description of our pro- met. fession, changes within the industry, skills required, By the end of the night I got the sense that students and the benefits of IIA membership and CIA certifica- began to look at internal audit in a different light. It tion. was great to interact and see students take interest The first question I asked the students was what do in the work we do every day. I hope to continue you think an auditor does? I got responses ranging more outreach presentations in the future. You can from, “Well auditors are accountants right?” to view my presentation on “Aren’t you in charge of firing people”. I clarified the IIA San Gabriel website. these misperceptions and communicated the true Please contact me with nature of internal audi- comments and/or sug- tors as trusted advisors gestions.

and Guarav Kapoor state in “An Internal Audit Up- Five Emerging Technology grade,” “Audit plans should incorporate risk identifi- cation and prioritization, as well as analysis and quan- Risks of Which Internal tification of risk factors in new business ventures and strategies. They [audit plans] should also include an

Auditors Should Be Aware understanding of shared risks among various projects Shannon Steffee and initiatives and continuous monitoring of business Associate Editor activities and key performance indicators.” Internal Auditor Internal auditors should take a proactive approach to identifying emerging IT risks so adequate measures The world of IT is continually evolving, advancing, can be taken to include them in a strategic audit plan. and changing at an increasing pace. Internal auditors should continually reassess the risks facing their or- With the help of Steve Mar, ITAudit contributing edi- ganizations and the role internal auditing plays in tor, Internal Auditor has identified five emerging tech- mitigating them. Once emerging risks have been nology risks of which internal auditors should be identified, it is the auditor who brings them to the aware. attention of key stakeholders. From http://www.theiia.org/intAuditor/five-emerging-trends-in Internal auditing should perform a risk assessment to help identify the emerging IT risks that should be -technology-slide-show/ included in a risk-based audit plan. As Ron Cathcart Page 7 Board Members and Officers

If you wish to contact a Board Member, or Officer, please e-mail Contact Board Member or Officer

OFFICERS President Sangeeta Patel V-P and Programs Chair Ruthe Holden V-P Nominating Monica Raffety Treasurer Mark Canevari Secretary Kathy Knox

COMMITTEES Academic Relations Ping Liu/Jason Nishi- yama Audit Mark Concialdi Awards Norma Valenciano CAP Chair Rey Bejerano Certification Nancy Neville Employment/Career Devel- Sylvia Lew/Ameri opment Rameriz Facilities Arrangement Linda Hodges Meeting Arrangements Jan Biferno/Meeta Bindra Membership Susan Egerman Nominating Laurice Balian Programs Lizzette Espinoza Seminars Diane Estrada Hospitality Mimi Htut Newsletter Claudia Casasola Publicity and Public Rela- Available tions Webmaster Claudia Casasola/ Luceli Ceja Senior Audit Executives Ruthe Holden Events

Board of Governors Governor at Large Sharon Collins Governor at Large Fred Stevens Governor at Large Megan Scott-Kakures Governor at Large Lynn McKenzie Governor at Large Pam Koyzis

Board of Governors-Past Presidents Past President (2nd Term) Laurice Balian Past President (1st Term) Nancy Neville Page 8