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Factors that make one size fits all unattainable include organization size, and type of organization (private, governmental, corporate) Accordingly, the CAE should consider the following attributes in evaluating the appropriateness of the administrative reporting line Does the individual have sufficient authority and stature to ensure the effectiveness of the function Does the individual have an appropriate control and governance mindset to assist the CAE in their role Does the individual have the time and interest to actively support the CAE on audit issues Does the individual understand the functional reporting relationship and support it 5 The CAE should also ensure that appropriate independence is maintained if the individual responsible for the administrative reporting line is also responsible for other activities in the organization, which are subject to internal audit For example, some CAEs report administratively to the Chief Financial Officer, who is also responsible for the organization s accounting functions.

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to the other beneficiaries, then the required distribution schedule for the other beneficiaries can be computed as though the charity and its share never were involved The disadvantage of naming a charity as IRA beneficiary is that the amount the charity will receive fluctuates with the investment performance of the account In addition, if the charity is co-beneficiary with one or more heirs, the owner doesn t know how much the heirs will receive At one point it might seem reasonable to give a charity one-third of an IRA and the owner s children the rest A few months later the IRA s value might decline substantially, leaving the children less wealth than expected Or the IRA might increase substantially, giving the charity far more than the owner would have liked.

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[289] JS Fenton, Information Protection Systems, PhD thesis, Cambridge University, 1973. [290] N Ferguson, B Schneier, A Cryptographic Evaluation of IPSEC, at

One way around this disadvantage is for the owner to name the charity as a contingent beneficiary and tell the estate executor and the heirs of his or her desires for the charity Then the beneficiaries can disclaim part of the inheritance after working with the executor to determine a reasonable amount to leave the charity Another solution is to draft a detailed beneficiary designation form that leaves the charity the lesser of a stated percentage of the account or a certain amount For example, the statement could say that the charity is beneficiary for the lesser of one-fifth the IRA or $20,000 Not all IRA custodians, however, accept such customized forms Name a lot of contingent beneficiaries The IRS regulations give the estate and beneficiaries a great deal of flexibility in determining the final amounts received by different heirs.

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The internal audit function should be free to audit and report on any activity that also reports to its administrative head if it deems that coverage appropriate for its audit plan Any limitation in scope or reporting of results of these activities should be brought to the attention of the audit committee 6 Under the recent move to a stricter legislative and regulatory climate regarding financial reporting around the globe, the CAE s reporting lines should be appropriate to enable the internal audit activity to meet any increased needs of the audit committee or other significant stakeholders Increasingly, the CAE is being asked to take a more significant role in the organization s governance and risk management activities The reporting lines of the CAE should facilitate the ability of the internal audit activity to meet these expectations..

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