Internal Audit Department

The Internal Audit Department is a separate structural entity within CTC Media established to independently examine and evaluate the activities of the Company as a service to the Board of Directors in particular and to the management in general.

Internal  Audit  Charter

In accordance with the professional standards of the Institute of Internal Auditors and based on the needs and expectations of the key Internal Audit Department’s stakeholders, the Internal Audit Charter, defining the Internal Audit Department’s purpose, authority and responsibility, was endorsed by the Company’s executive management and approved by the Audit Committee initially on 25 July 2007. The last revision of the Internal Audit Charter was revalidated on 21 October 2009.

Mission
 
As per Internal Audit Charter, the mission of the Internal Audit Department is to provide independent, objective assurance and consulting services designed to add value and improve the Company’s operations. It helps the Company accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, internal control, and governance processes.

Independence

As per Internal Audit Charter, to provide for the independence of the Internal Audit Department, its personnel report to the Director of the Internal Audit, who reports functionally to the Audit Committee of the Board of Directors and administratively to the CFO.

Internal Audit Process

A streamlined, transparent and robust internal audit process was developed, agreed with the executive management and approved by the Audit Committee in the official Regulation on organization of the internal audit process and interaction throughout its execution. 

The internal audit process includes the following best-in-class practices, as required by the Institute of Internal Auditors standards:

1. Development of risk-based Internal Audit Plan consistent with stakeholders’ needs and organizational goals,
2. Detailed objective-setting and scoping in the Terms of Reference for each audit with inputs of the process owner, executive management and the Audit Committee,
3. Audit reports and executive summaries, addressing key findings, risks and recommendations to correct identified deficiencies and facilitate continuous improvement,
4. Review of the key findings, risks and recommendations with the executive management and the Audit Committee and assigning responsibility for recommendations implementation,
5. Robust Audit Recommendations Implementation Monitoring Process and periodic reporting to the Audit Committee.

When performing the audits, Internal Audit Department benchmarks against the industry best practices as well as against recognized internal controls, risk management and corporate governance models. Quality assurance and improvement program is operating within the Internal Audit Department to ensure compliance with Institute of Internal Auditors’ standards and for periodic obtaining the key stakeholders’ feedback for better serving their needs and expectations.