Internal Control Audits

A credit union may engage an auditor to perform an audit of ICFR that is integrated with the annual audit of its financial statements.

American Institute of Certified Public Accountants auditing standard AU-C Section 940 addresses these audits and states that the objectives of such an audit of internal controls are to:

• Obtain reasonable assurance about the existence of material weaknesses in management’s assessment of ICFR effectiveness as of a specified date

• Express an opinion on the effectiveness of ICFR in a written report, and communicate with management and those charged with governance

If a credit union has engaged an auditor to perform an audit of ICFR that is integrated with the annual audit of its financial statements, examiners review the auditor’s report on the audit of ICFR for noted deficiencies in the credit union’s internal controls that result in material weaknesses. Examiners follow-up with credit union management to verify the credit union has corrected its material weaknesses.

The supervisory committee engages the auditor and reports the results of the review through the supervisory committee. Not all FISCUs have supervisory committees. In such cases, the FISCU is subject to the requirements of their specific State.

Last Updated on October 14, 2021