TORALDE, MA.KRISTINE E.

CBET-01-501E

1. Explain the elements of the CCCER/5C model.

Internal auditors work is to review the performance of organization if it’s

according to its policies, strategies, guidelines, etc. Internal auditors prepares what is
commonly known as “findings” some organization used other similar term other than
“Findings”, but many organization still used this term. So in constructing a “findings”
internal auditors used a systematic framework known as CCCER/5C model.

2. What constitutes criteria and how can operational auditors identify it?

Criteria this includes standards and expectations for the performance of the
organization which are set by stakeholders. Internal auditors use this to see if the
operational performance has accomplished what is expected to be done. The standard
is made by looking at what the organization can do and the available resources for
operation, because why set standards that the organization cannot meet due to lack of
resources. Policies, strategies, guidelines, and etc. are also a factors to create a criteria
for an organization.

3. What constitutes the condition and how can operational auditors define it?

Condition includes the current state of an organization that is different from

what is expected or the criteria. The task of the internal auditor is to evaluate the
operation of the organization, whether the organization has met the expectations of the
relevant stakeholders. They gathered data that they obtained throughout the year of
the organization's operation and review those data to see if the organization performed
according to the plan and the available resources.

4. What constitutes the cause and how can operational auditors find it?

Cause includes the reasons why there are discrepancies in the criteria and
condition of the organization, the root cause or the problem that make way in the
process of making the objectives of the organization. There are tools that internal
auditors can use to find the root cause of problem to know why there are discrepancies
between the expected and actual. Those tools are the 5 Whys, Cause and Effect Diagram
and Drill down, so if internal auditors fails to know the root cause of the problem the
inefficiency will continue.
5. What constitutes the effect and how can operational auditors calculate it?

Effect includes the consequence of the discrepancies identified between the

criteria and condition. This is the result of the organization's inconsistencies in strategy,
program, plan, and policy and so on. A helpful approach that internal auditors can use
to calculate the effect on the organization is to ask the question "So what?” It seems to
be said that so what if there are discrepancies between the expectation and actual?
What will be the effect then on the organization. If the internal auditors fails to know
what will be the effect on the organization, they will not be able to convince the
organization to find a solution to the problem and will not pay attention to the
discrepancies

6. What constitutes the recommendation and how can operational auditors formulate it?

Recommendation it includes the actions or solutions that when properly

implemented the organization can achieve the expectations or the criteria that are set
by the relevant stakeholders. Internal auditors formulate recommendation through the
use of the components of the CCCER, internal auditors carefully study the findings and
see what can be recommended to the organization to improve the process. The
recommendations that internal auditors should prepare should be cost effective, those
that can achieve the objectives of the organization and at the same time the cost to the
organization is not too burdensome and in accordance with the available resources that
the organization has.

7. Explain three methodologies that can help operational auditors find the root cause of
operational deficiencies.

 5 Whys method is a repetitive method to find out where the problem started, it
is repeatedly asked why until the root of the problem is known. It is also the
simplest method available to internal auditors to find the root cause of a
problem. 5 whys is asked on different grounds but with the same problem to find
out what is the main cause of many problems identified by internal auditors at
the end of the process.
 Cause and Effect Diagram also known as fishbone diagram using this to find out
what are the factors or the possible causes of the problem in the process. It is
the sorting of ideas identified by internal auditors that gives the organization
problems. It provides a diagram that is easier to understand for members of the
organization because it has visuals. In making fishbone diagram the main cause
of the problem is in the head or mouth of the fish.
  Drill down is the breaking down of identified problems to be more detailed and
to be better understood especially if the problem is too big.

8. List three actions that can help to make findings and recommendations more
persuasive.

 Quantify as much as possible. When the internal auditors give a report, they
need to have evidence data that can tell the members of the organization that
there is a problem with the organization and how that can impact the
organization on how it affects in terms of monetary and numbers, because when
he fails in that part the readers will not believe of his reports that there is a
problem.
 Make sure the findings are significant. So since internal auditors' reports are for
an organization, it is imperative that their findings can have a significant impact
on the organization and not just on small problems that can be dealt with
immediately.
 Use appropriate language. Internal auditors' reports are really long with terms
that an accountant can only understand, so what is commonly a problem for
readers of the report is that it is difficult to understand. It is part of the
qualitative characteristics of a report that it must have understandability
characteristics, because what would be the sense of the report they prepared if
the readers did not understand it. So it is important that internal auditors should
always consider the readers of their report.

9. Explain the use of logic, character of the presenter, and emotion as tools for persuasion.

Persuasion can also be achieved using the approach of logos, ethos and pathos.
The logo is a Greek word logic in English, this approach uses fact or reason in persuading
because the findings are more convincing when there is strong evidence attached to it.
Because its process is based on the fact that readers will believe that it is logical and
reasonable.
Ethos or the character of the presenter affects it in the minds of the auditees,
the ethos is your reputation as an internal reviewer, the task of the internal auditor in
an organization is to provide relevant findings that can benefit the organization so When
your record as an internal reviewer reaches the level of credibility, whatever you say to
the auditees they will believe because of your reputation as a professional, the accuracy
of the report you made, your consistency in providing outstanding results, and great
help for your organization.
 Pathos or emotion is the third approach, of the three approaches it should be
the least used by internal auditors because even if it is effective sometimes it is not used
with sincerity. It is used by enticing good or bad tactics, intimidation, and showing pity
and flattery words. It also affects the reputation of internal auditors so it should be used
in the right way.

10. Explain three tactics used to persuade, distract, and divert the attention of others. How
should operational auditors use this knowledge to prevent being manipulated
themselves?

 Repetition. Repeating the argument the auditee will be persuaded that what the
internal auditors are saying is legit, but sometimes it is used to confuse the
auditee even if the statements are wrong.
 Will of the majority. These are the tactics that represent others' arguments to
show that this is the will of the majority, and because they are more confident
because more people share that knowledge or opinion.
 Generalization. This tactics tells the auditee that "everyone is doing it". This is
the commonly used statement to divert, distract or persuade the auditee that his
point of view is correct. But because it is quite common it is not very acceptable
to auditees.

Reference
1. Hernan, M. Operational Auditing: Principles and Techniques for a Changing World.
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Chapter 5 Control Frameworks. P. 223. New York. CRC Press.
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 Retrieved from https://misti.com/internal-audit-insights/why-internal-auditors-
should-use-the-5-whys-method-for-root-cause-analysis
  Retrieved from https://www.cms.gov/medicare/provider-enrollment-and-
certification/qapi/downloads/fishbonerevised.pdf
 Retrieved from http://meaningring.com/2019/03/21/work-principles-12-
4/#:~:text=A%20drill%2Ddown%20is%20a,to%20make%20the%20area%20excell
ent.&text=A%20drill%2Ddown%20takes%20place,by%20design%20and%20exec
ution%20steps.

8. Hernan, M. Operational Auditing: Principles and Techniques for a Changing World.

Chapter 5 Control Frameworks. P. 225. New York. CRC Press.
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