Implement Organisational Improvement Programs | Desklib

This document provides insights on implementing organisational improvement programs to enhance decision making, information management, and technology systems. It discusses the importance of better value and improved services. The focus areas include information and data reform, technology reform, and capability uplift.

FNSACC605 Implement organisational improvement
programs
FNSACC606 Conduct internal audit
Assessment 3
Written Report
Executive Summary
--------------------------------------------------------------------------------------------------------------------------
NAILSMA, like other organisations, must continually address the issue of aging
technology systems and outdated approaches to providing computing resources.
Older systems can prevent the seamless sharing of information and can pose security
risks.
Our aim is to put in place the tools and systems that will:
 enable better decision making at the service and policy level
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 improve the management of and increase the security of our information and
technology
 create better value from our overall IT investment and
 develop new and improved services both for our own workforce and the NAILSMA
community that we serve.
Our approach
Vision  better information  easier engagement  contemporary technologycapable
people
Focus on priority areas
 Information and data reform
 We want data and information to be available in a way that helps us make good
decisions.
 That means information comes from trusted sources, is accessible and provides
evidence-based insights. Information should be consistent, easy to use, secure and
integrated.
Technology reform
 We want the technology systems we use to be contemporary, secure, foster
collaboration and enable data sharing.
 Standard corporate systems across NAILSMA to reduce cost, improve productivity
and streamline collaboration.
Capability uplift
 We want NAILSMA employees to understand the value of technology and be capable
in procuring contemporary systems.
 That means a strategic understanding of technology procurement, better project
management, an improved understanding of cyber security, and clearer governance.
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Table of contents
EXECUTIVE SUMMARY………………………………………………………………………………………………..2
1. Introduction……………………………………………………………………………………………………………
2. Analysis and Description…………………………………………………………………………………………..
a) The user requirements for information systems……………………………...
b) The hardware and software needs of the organisation…………………..
c) Accounting data and security……………………………………………………….
d) Policy and procedure document……………………………………………………..
l. risks faced by the organisation and the management of those
risks………………………………………………………………………………………….
ll. controls and processes for expenditure
(on capital and expense items)…………………………………………….…
lll. Compliance with legislative and statutory requirements……..
3. Report Conclusion………………………………………………………………………………………………….
4. Recommendation…………………………………………………………………………………………………..
REFERENCE…………………………………………………………………………………………………………………
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INTRODUCTION AND BACKGROUND
The Vision of NAILSMA is:
Northern Australia is a vibrant region where Indigenous traditional knowledge,
cultural values and responsibilities to the land and waters are embedded in all
environmental, economic and resource management policies and practices
(Beauchamp and et. al., 2017).
The Mission and Values Statement of NAILSMA are:
NAILSMA successfully leads innovative and sustainable land and sea management
across northern Australia. Using the strength of the alliance, it supports its members
to improve the livelihood of current and future generations of Traditional Owners
through sustainable conservation, management and development of the lands and
seas of the north.
Review Strategic Plan
The original strategic plan was completed and endorsed by the NAILSMA Board in
April 2017 and was presented to staff in November 2016.The original strategic plan
covered a five-year time frame from 2017 to 2021 but the vision achievement
window was set for a period of 10-20 years.
The review is not a new strategic plan, nor a re-write of the original strategic plan,
but rather a review as to what has already been achieved, consideration of any
changed imperatives that will affect the next two years within the original strategic
plan, and consideration of priorities for the next immediate 12 to 24 months.
As a result of the strategic initiatives completed by the company in the first three
years and the change to the environment of the company, the key strategic issues
were reviewed.
Analysis of the Information Systems
Base on the analysis and user feedback from the previous reports on constrains of
the current information systems, the weaknesses on communication within the
organisation must be improved.
In order to achieve this, the priority is to develop an organisational improvement
program to restructure its information technology systems. The Management aware
that the restructure will modernise the use of technology and processes and reduce
overheads. The functions of communication in an organization are to inform,
persuade, and motivate. Employees need to have effective organizational
communication by having accurate and correct data information in order to achieve
excellent job performance.
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ELEMENTS OF THE IMPROVEMENT PROGRAM
Since goals are defined based on business plans, it is important to provide a well-articulated,
long-term strategic business plan that includes shorter fiscal year operating plans (Bourne,
2016). The “glue” to alignment is having a business plan that is consistent with the
organization’s vision, mission, and values.
Business objectives for NAILSMA are designed to:
 Set targets for the organisation to work towards;
 Give the organisation and its employees direction;
 Motivate employees
On the two elements of the improvement program below, we are now looking:
1. To identify two short-term ( 1-5 years) and two long-term ( 5 years or greater)
objectives
 to achieve for NAILSMA with the use of a SMART goal strategy which set up for
success
 by making it specific, measurable, achievable, realistic, and timely. The SMART
method
 helps to push further, gives a sense of direction, and helps to organize and reach
goals.
 Bear in mind that a short term strategy can be developed into a long term objectives
too.
a) Improving the financial position of the organisation:
i) SHORT -TERM (1-5 YEARS)
 Secure core-funding and top up salary requirements needs for the rest of
2021 in order to improve employee’s performance 10% more.
 Prepare marketing plans/capability brochure Develop better access to data
management and information systems within a year to increase current
market share 15% more.
ii) LONG-TERM ( 5 years and over) Networking and looking for future project funding after 2025 onwards for the
betterment of brand image of the company 10% more. Planning further strategy to fund the upgrade of information technology
beyond 2025 to enhance business profitability by 20%.
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b) Improving the use of organisational resources
Highly effective organizations exhibit strengths across five areas: leadership, decision
making and structure, people, work processes and systems, and culture.
i) SHOR-TERM (1-5 YEARS) and DEVELOP INTO LONG-TERM (5 YEARSAND OVER)
Establish and implement succession planning processes to:
 Strive to secure tenure of staff contracts, to reduce employee turnover by 5% over
the financial year
 Ensure knowledge is shared and corporate knowledge is retained by providing
appropriate training to employees within one year in order to enhance business
productivity 20% more.
ii) LONG-TERM (5 years and over)
 To implement desired variations as changes in business structure to increase
revenue of firm by 15% within next 5 years. To ensure effective use of available resources within 6 years to gain the position of
market leader for enhancing its competitiveness.
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2. Impact of external factors and trends
The Macro Environment is the external environment and includes all elements that the
organisation cannot control (Härter and et. al., 2017). Let now use PESTLE to perform an
external environmental analysis by examining the many different external factors affecting
an organisation.
The six attributes of PESTLE related to impact of external factors and trends:
I. Political – The degree of government intervention in the economy like
taxation rate and expenditure. Political decisions can have an impact on
NAILSMA, if government cut expenditure there will be less opportunity for
NAILSMA to secure more projects funding. Regulation and deregulation
refers to the level of government intervention or regulation in economy
(Khan and Keung, 2016). Regulations can have severe implications for
business. Indeed the overall trend in the Australian economy is towards
deregulation, including the removal of barriers to trade such as tariffs, and a
removal of restrictions and barriers to enter markets to increase competition.
II. Economic- NAILSMA will be affected by the state of the economy and many
other key economic variables like the local, national and world economy
impact. Secure of grant funding will be affected due to the rate if the
economy is contracting, inflation, level of interest rates, unemployment, the
business cycle of recession/expansion/boom/contraction.
III. Sociological- The ways in which a society can affect NAILSMA. Different
cultures have different attitudes to work. Provide a service that becomes a
socially unacceptable for any reason could be disastrous for an organisation
like NAILSMA, so keeping track of social attitudes is crucial. Examples are:
corporate responsibility and greed that may affect the public opinion and
Social attitudes of an organisation.
IV. Technological- Technology now dominates all aspects of business operations.
In particular advances in communications systems have seen the
international marketplace develop. If NAILSMA is slow to react to new
technology, then it will generate the constraints of the current information
systems as mentioned in the previous analysis and description. This written
report is prepared to develop the improvement program to restructure its
information technology to look at the impact of emerging technologies,
impact of the internet such as reduction in communication costs and
increased remote working, online distribution, marketing and advertising,
Research & development activity and impact of technology transfer.
V. Legal- Legal factors represent those restraints placed upon an organisation by
the Australian and international legal system which includes legislation
covering employment and intellectual property law. Legal changes can affect
NAILSMA costs and demand (McLean, Antony and Dahlgaard, 2017). For
example, NAILSMA required to apply for permits to be able to conduct
research on Indigenous owner right region. Occupational Health and safety
regulations are designed to protect employees by providing safe workplaces
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like protective clothing and equipment or safe machinery/workstation, etc.
Registrations of unique designs, trademarks and designs can legally protect
VI. Environmental- The local, national and world environmental issues.
Environmental factors include the weather and climate change, and natural
disasters such as droughts floods, tsunamis, etc. Changes in temperature can
impact on many industries including farming, tourism and insurance
(Molineux, Mirshekary and Scarparo, 2015). The general move towards more
environmentally friendly products and processes is affecting demand
patterns and create opportunities.
Based on the findings of the PESTLE analysis, we are now to produce a SWOT analysis and
evaluate the organisation against its external relationships and environmental factors and
an assessment of the financial and resource management implications for the improvement
program.
SWOT is used to help focus activities into areas of strength and here the greatest of strength
and where the greatest opportunities lie. Conducting a SWOT analysis will help the
organisation to understand the strengths and weaknesses that will influence the
organisations ability to take advantage of a new opportunity. If the business doesn’t have
the capability to seize and opportunity but decides to anyway, it could be damaging or vice-
versa (Pearce, Pons and Neitzert, 2018). This analysis can be used to help decide if and how
NAILSMA restructure its information technology systems.
A financial implication can be defined as an outcome or an impact with respect to
the finances of the organisation. Whereas resource management implications are outcomes
or impact that relate to the organisation's resources.
STRENGTHS WEAKNESESS OPPORTUNITIES THREATS
- NAILSMA has a
track record of
facilitating
partners
- NAILSMA has a
strong reputation
for its work with
Indigenous people
in North Australia
in some
Government
departments
- NAILSMA is
reasonably well
recognised by
communities with
which it works
(Pinnock and et.
al., 2015).
 NAILSMA
-Lack of awareness
of who NAILSMA is
among those who
should know
-Limited resources-
money and time
-Clunky
communications
approval processes
-Too much reliance
on one or two staff
members for media
work
-Lack of
united/uniform
description of
NAILSMA for
different groups
including:
participants,
A coordinated
communications
approach will assist
NAILSMA at
corporate and
program level
-A revised
communications
staffing structure
should allow
NAILSMA to improve
communications at
corporate and
program level
-An updated,
communications
focused website will
make a difference to
explaining NAILSMA
and its work
Continued lack of
acknowledgement by
partners/Government
will undercut
NAILSMA’s fund raising
and communication
efforts
-Short term and/or
politically motivated
funding may see
NAILSMA’s reputation
damaged
-Communications team
already in overload,
danger of spreading
itself too thin
-not getting the right
communications team
together will continue
to hinder
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has
communica
tion officers
for each
program.
 Since the
company
has a
strong
rapport, it
has good
financial
implication
s which
includes
funding
that will be
required for
the
program,
reduced
overheads,
cost of
recruitment
and training
as well as
monitoring
the costs of
the
program
etc.
 This means
that a lot of
people
want to
work for
the
company,
thus it
keeps on
implementi
ng changes
in order
stay
relevant in
the market.
 The owner
partners,
government,
donors and
corporations
 The
company
does not
have a very
strong
security
control
which
means its
data is
under the
risk of
getting
stolen
which will
impact it
greatly.
 Also there
are no
security
guards or
gatekeepers
which
means
anyone can
enter the
organisation
any time.
Thus, the
organisation
is under a
high risk of
getting
affected.
- NAILSMA-through
revised
communications-can
capitalise on its work
in carbon, social and
environmental
issues
-That the process of
succession planning
includes a process of
mentorship(internal)
and cadetships
(external)
 The
respective
organisation
has various
opportunities
like
implementin
g changes
whenever
there is a
need.
 Changes
include
effective
communicati
on, providing
timely
training to
the new
hires,
developing
budgets as
well as
recruiting
new people.
-Scepticism among
some corporates
around Indigenous
organisations and
financial management
-Lack of sustainable
income-too reliant on
project funding
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of the
company
monitors all
the
activities
which
means that
there are
less
chances
that an
employee
will do
something
wrong as all
activities
are
monitored
and
tracked.
 Also, the
company
has strong
policies and
ethics
which the
employees
are
expected to
follow at all
times.
3. Review of internal control systems
In an “effective” internal control system, the following five components work to support the
achievement of an entity's mission, strategies and related business objectives.
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 Control Environment
 Risk Assessment
 Control Activities
 Information and Communication
 Monitoring Activities
Internal controls are put into place so an organization's activities, policies and plans are
efficiently integrated to best achieve business goals. Other purposes of internal control are
to protect a firm from mismanagement or fraud, to ensure the company's actions are within
the bounds of the law, and to compile financial and managerial data that can be evaluated
so that feedback can be given and implemented (Portela and et. al., 2015). Ultimately, the
information gathered will be presented to the company's directors, board and/or
shareholders.
For each component of these internal control system, we will identify one strength and one
weakness for the organisation that could impact on the improvement program as the table
below:
Component Strength Weakness
Control
Environment
This is the tone set by the board
members and management team
of NAILSMA. Managers should
have established policies, like a
code of ethics, and follow these
policies in order for employees to
take the internal controls
seriously. NAILSMA has a strong
rapport and recognised
reasonably well within the
communities it works in which act
as its strengths.
Leaders that lack a strong vision
and that are unable to properly
manage their teams will find it
difficult to achieve their goals.
Employees misuse company
resources.
Risk Assessment NAILSMA faces general financial
risks and specific risks based on
their product and industry.
Identifying risks allows the
company to create policies that
will minimize the damage of fraud
or mistakes (Reames and et. al.,
2015).
Weak security controls for hard
copy information, blank checks
and check stamping equipment
can lead to theft of information,
money or equipment. Identity
theft can result from weak
internal controls and leave the
affected employee in financial
ruin.
Control Activities Control procedures are the way
the company gains access to the
objectives of internal control.
not enforcing separation of
duties internal controls is an
open invitation to
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Control procedures include proper
segregation of duties,
comparisons, checks, adequate
records, proper approvals and
physical safeguards to protect
assets
embezzlement and fraud.
Irresponsible of staff for any
irregularities or
misappropriations of funds.
There are a lot employees in
the company and there is no
way of distinguishing them like
different uniforms for
participants, partners etc.
Information and
Communication
An information system is how the
company processes accounting
data. The owner must have an
accurate system for keeping track
of assets, profits and losses. The
information system should be able
to capture, record, summarise,
post and record financial
transactions.
technology and the data
produces are key drivers to
propel a business forward and
sustain growth (Sarhan and et.
al., 2017). Data are produced
and collected everywhere. But
if data are not properly
managed, organisation can end
up rich in data, but poor in
information to drive the
business forward. Since the
company works within only
limited communities, there are
many organisations that are not
aware of its existence in the
market, which should be
communicated.
Monitoring
Activities
Monitoring controls means that
no person or group can process a
transaction without some sort of
surveillance. Nowadays, the
surveillance can be built into the
computer system used to process
transactions. Systems can be
programmed to “red flag” high-
risk transactions for additional
managerial scrutiny (Waddell and
et. al., 2019). Thus, all activities
are monitored by the owner in
order to minimise the risk of
anything wrong happening.
There are no gatekeepers
controlling information as there
are fewer middle management
employees. This structure
generally allows for both
internal and external
communication to flow freely,
and empower employees with
access to relevant information.
Internal auditor may become
over-dependent on the internal
control system, which may lead
them to relax other measures
of checking for fraud and
errors.
4. Analysis of the improvement program:
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a) We will identify two possible options for restructure of the organisation’s
information technology systems. Seeking to improve efficiency and reduce duplication within and across jobs,
functions and teams and the business systems required to enable optimum
outcomes Ensure the right people with the necessary skills are in the right places
producing desired outcomes.
Cost-Benefit Analysis is useful and help making important decisions. Using a cost benefit
analysis can help teams identify the highest and best return on an investment based
on the cost, resources, and risk involved.
COSTS
Category Details Cost in first year
Lease T0 require extra space of 750 square feet
available next door at $18 per square
foot ,increase to $28 after the 5th year
$13,500
Cost Leasehold
improvements
Knock out walls and reconfigure office space $15,000
Hire IT System
Analysis/comm
unication
Manager + on
costs
Salary, including benefits
Recruitment Costs
Orientation and training
$90,000
$11,250
$3,000
Two new
workstations
Furniture and hardware
Software licenses
1 x software licence
6,000
500
Communication
equipment &
upgrade
$9,600
Network Data
Storage, firewall
and Network
Switch
Netgear & labour
Watchguard firebox with 3 year security suite
Netgear -port Gigabit
Anti-virus installation & monitoring portal
setup
Backup server
5,953
$2,820
$1,800
$ 600
Upgrade to 12
new computers
To replace old computer for 12 staff $ 14,400
Total costs $164,823
Benefits
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Benefit
Benefit Within 12
Months
50% funding increase $150,000
2 x project Communication Officer- contracts not renewed $120,000
Total $270,000
Payback time as shown below: 164,823/270,000=0.61 of a year, or approximately 7.3
months.
b) Identify two financing Options to fund the improvement program:
Debt and equity:
Debt financing- This is a type of source of finance in which a firm can raise money by making
sale of bonds, bills and notes to other investors. In return of lending money, the investors become
creditors and liable to repay the amount with interest. It is one of the key source of finance that can
be helpful for NAILSMA. It has some limitations and benefits such as:
Benefits-
 This source of finance provides more control.
 It is cost effective.
Drawbacks:
 Under this method, credit rating can be spoiled in further time.
 Higher interest rate is also an issue in this technique.
Equity finance- Equity financing is the method of equity generation via the selling of shares.
Organisations raise funds because they could need to pay bills in the near term or because they may
have a lengthy-term goal and need funds to invest in their growth. The above company can raise
fund by this method. It has some benefits and drawbacks as:
Benefits-
 Permanent source of finance
 Under this, it is not liability to pay dividends.
Drawbacks:
 Higher cost of funds is main issue of this method.
 It consumes too much time.
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c) Program budget (Appendix A). The budget costs of the program will be expected to cause
impact on revenues and costs of the organisation. Careful planning and budgeting provide
direction, motivation, and performance evaluation.
 Fixed expenses are those that remain relatively constant, regardless of the level of
income. Examples can include rent, salaries and insurance. Surplus can be impacted
where funds decrease and fixed costs remain constant. Additionally, although
termed “fixed”, these costs can increase in line with changing economic and other
trading conditions.
 Variable expenses are those that move relative to income. Examples can include
consultancy, marketing and casual labour. Monitoring variable costs is critical to
surplus. Where income remain flat or decrease, it is important to manage variable
costs in line with income to avoid erosion of surplus.
Budget:
Particulars Year 1 Year 2 Year 3 Year 4 Year 5 Year 6
Lease 13500 13500 13500 13500 13500 21000
Cost of lease hold 15000 15000 15000 15000 15000 15000
Hire IT system analysis 104250 104250 104250 104250 104250 104250
New work station 6500 6500 6500 6500 6500 6500
Communication equipment 9600
Net gear and labour 5953 5953 5953 5953 5953 5953
Watch guard 2820 2820
Net gear port gigabit 1800 1800 1800 1800 1800 1800
Back up 600 600 600 600 600 600
Up gradation to new computers 14400
Total budgeted program cost 174423 147603 147603 150423 147603 155103
Increased funding 150000 150000 150000 150000 150000 150000
Project communication officer
contract 120000
Total organisational savings 270000 150000 150000 150000 150000 150000
d) This report is using Ratios as one financial analysis technique to evaluate the outcomes
of the improvement program against the objectives as noted in question 1. Financial
statements can be supplemented with a table of financial ratios. Financial ratios measure the
relationship between the financial information shown in financial statements. They provide a
Managing cultural diversity in the workplace16

useful summary check of the acceptability of forecasts and can identify strengths and
weaknesses in planned operating activities.
 Profitability Ratios: These analyse profit margins from various aspects in relation to
income and measure efficiency.
 Liquidity Ratios: These measure the organisation’s ability to meet its short-term
financial obligations.
 Activity Ratios: This is a series of measures to establish the effectiveness of a firm’s use
of its assets.
5. Develop a schedule to implement the improvement program
a) Improving the financial position of the organisation:
Short term
Objectives Start date End date Date of review Reviewed by
Secure core-
funding and top
up salary
requirements
needs for the
rest of 2021 in
order to improve
employee’s
performance
10% more.
1st Jan 2020 31st Jan 2021 15th June 2020 Project Manager
and Admin
Manager
Prepare
marketing
plans/capability
brochure
Develop better
access to data
management
and information
systems within a
year to increase
current market
share 15% more.
1st Jan 2020 17th Jan 2021 19th July 2020 Staff member
Long term
Networking and
looking for
1st Jan 2020 20th September 18th July 2021 IT department
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future project
funding after
2025 onwards
for the
betterment of
brand image of
the company
10% more.
2027 and CFO
Planning further
strategy to fund
the upgrade of
information
technology
beyond 2025 to
enhance
business
profitability by
20%.
1st Jan 2020 13th August 2026 11th May 2021 Manager and
Project Manager
b) Improving the use of organisational resources
Short term
Objectives Start date End date Date of review Reviewed by
Strive to secure
tenure of staff
contracts, to
reduce
employee
turnover by 5%
over the financial
year
2nd July 2020 31st July 2021 12th June 2020 Admin Manager
Ensure
knowledge is
shared and
corporate
knowledge is
retained by
providing
appropriate
training to
employees
within one year
2nd July 2020 31st August 2021 15th July 2020 Manager and
Project Manager
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in order to
enhance
business
productivity 20%
more.
Long term
To implement
desired
variations as
changes in
business
structure to
increase revenue
of firm by 15%
within next 5
years.
2nd July 2020 15th December
2025
8th August 2023 IT department
and CFO
To ensure
effective use of
available
resources within
6 years to gain
the position of
market leader
for enhancing its
competitiveness.
2nd July 2020 17th June 2026 12th April 2022 Manager
Periodic review – The outcomes of the program will be periodically reviewed by a staff
member which will help the organisation in identifying the various factors that might be
impacting its functioning. The various factors that might impact the achievement of the
objectives of the improvement plan are as follows - Resistance of employees and job insecurity – The employees may show resistance
while implementation of the change and might not want to adapt it. Also, there may
be a sense of job insecurity among them. For example- they might think that the
change that is being implemented might replace their jobs. Ineffective communication – There can be chances that the management of the
company failed to communicate the change effectively to the employees which can
lead to a mutual misunderstanding between the organisation's management as well
as the workforce. Use of ineffective communication channels can also impact the
company's overall achievement of its goals and objectives.
 Workload – If the employees have excess workload, they will not be able to pay
attention to the change that is being implemented effectively. Thus, a lack of
Managing cultural diversity in the workplace19

concentration can also lead to the objectives not being achieved effectively and on
time.
Availability of options – The responsibility of looking out for different options that are
available in the market will be assigned to the IT department which will make the task of
finding and selecting the right option easier.
Reviewing Barriers and Update – Proper experts will be hired and the managers will be
responsible for constantly reviewing the barriers and updating the technology once the
change is implemented which is an important task.
6. Outline of the main features of a contingency plan that might be established to deal
with:
Contingent Plan
Issue Current Situation Early Warning
Indicators
Missing Information
Any implementation
problems or delays in
the improvement
program
Individuals and teams
are not actively
encouraged and
supported to
constantly participate
in the decision-
making processes.
Also, the technology
which is being used in
the organisation is
outdated. The user
requirements are
poorly specified. The
company is currently
reliable on
government funding.
There is old technology
in the company. And
the information on the
website is outdated.
There is no proper
understanding of the
requirements of both
the users as well as the
organisation. There is
no standard policy that
provides the users
knowledge about the
systems and
procedures of the
systems.
Causes of variations
in meeting the
programs objectives
There is a lack of time
and the project media
plans do not highlight
potential opportunities.
Also, the company
relies on only one or
two media
spokespeople who are
busy at most times.
Also, the company's
identity is not known
by many in the market
Very limited online
presence and the
percentage of people
using social media
increasing day by day.
The skills of the
employees are not up
to the mark and
demand training.
There was no proper
communication
between the
management as well as
the employees of the
company.
Managing cultural diversity in the workplace20

Thus, a contingent plan should be implemented and reviewed on a daily basis in
order to get a fair idea about the current situation within the company and what are the
indicators for it. Remedies like providing training to the staff, updating equipment,
outsourcing processes and providing additional resources like hiring new staff etc. can be
implemented. But when cases become extreme, the project can be terminated. Adopting
these remedies will help NAILSMA in overcoming its current situation and improving itself
on the whole.
7. For two of the procedures noted in the implementation
schedule per question 5 above.
Internal Audit helps an organisation to accomplish its objectives by
bringing a systematic, disciplined approach to evaluate and improve
the effectiveness of risk management, control and governance
processes. The following internal audit test that could be included in
the internal audit program, to test the improvement program has
achieved the procedure.
i) The test should use an appropriate audit testing technique and sample size
technique.
In the process of collecting evidential matter, the auditor is required to perform
audit testing technique to support all observations and opinion. During the
performance of such testing, the auditor is not required to test the population in its
entirety. Audit sampling may be employed.
Audit sampling is performing an audit test on less than 100 percent of a population
(Boer and et. al., 2017). In “sampling’, the auditor accepts the risk that some or all
errors will not be found and the conclusions drawn (i.e. all transactions were proper
and accurate) may be wrong. The type of sampling used and the number of items
selected should be based on the auditor’s understanding of the relative risks and
exposures of the areas audited. The audit sample will include 10 employees as this
will give the company an idea about if the change that is to be implemented is being
accepted by the staff without any resistance and how many sessions of training will
be required by the workers to become familiar with the change and adopt the same.
The method of audit sampling will help in reaching to conclusion about the large set
of data without having to examine each one.
i) The audit test documented complies with the Internal Audit Policies and
procedures.
The audit process is usually consists of nine stages. Through these stages, the
Internal Audit and Compliance Team will determine ways to minimise risks and
increase efficiencies within the areas:
 Plan – An audit plan will be developed by the internal audit and compliance
team after reviewing all the information. The information can be obtained
from various sources like internal and external evaluations, risk assessment
and guidance provided by the management. Planning will help in the timely
achievement of objectives.
Managing cultural diversity in the workplace21

 Notify – A meeting will be scheduled wherein all people who are responsible
for reviewing various processes and decide which ones have to be audited.
Also any factors that will impact the process of audit will be raised at this
time.
 Test – This process will include conduction of interviews in order to review
various processes and protocols, laws as well as policies.
 Communicate – The IT department will be kept informed of the audit it has to
undergo. Also, any changes should be communicated to the department in
order to avoid any issues.
 Draft – A draft of the report will be created which will include scope and
objectives, finding recommendations etc.
 Management response – The draft will be received by the management of
the company which will contain all the facts and figures. The management
has to review the same and respond if any changes have to be made in the
draft.
 Review – The final version is reviewed and any issues that are found are
resolved so that there is no problem in the future.
 Distribute – The final report is then distributed among all the members of the
process like managing director, audit committee etc. so that they are
informed about the meetings that take place from time to time.
 Verify – The compliance team will follow up on the findings that come
forward during the audit process within a particular time period.
Auditors must obtain all evidence necessary for the effective completion of the
audit. Work papers possess certain attributes to provide a sound basis for audit
observations and opinions and to be considered as evidential matter. These
attributes are:
a) Sufficient information is factual and adequate so that a prudent, informed
person would reach the same conclusions as the auditor
b) Information is reliable and the best attainable through use of appropriate
audit techniques
c) Relevant information supports audit findings and recommendations and
is
consistent with the audit objectives for the audit
d) Useful information helps the organisation meet its goals. It also provides
a
reference for the preparer when called upon to answer questions.
Managing cultural diversity in the workplace22

If the evidence supports the basic test of sufficiency, competence and relevance, it
may be used to support the auditor’s findings. The following outlines the different
types of evidence obtained during the course of an audit:
a) Physical evidence. Obtained through observation and inquiry
b) Testimonial evidence. Based on interviews and statements form involved
persons.
c) Documentary evidence. Consists of legislation, reports, minutes,
memoranda, contracts, extracts from accounting records, formal charts and
specifications of documentation flows, systems design, operational and
organisational structure
d) Analytical evidence. This is secured by analysis of information collected by the
auditor.
The type of sampling used and the number of items selected should be based on the
auditor’s understanding of the relative risks and exposures of the areas audited. Types of
samples include:
a) Statistical or probability sampling. Allows the auditor to stipulate, with a given level of
confidence, the condition of a large population by reviewing only a percentage of the total
items. Several sampling techniques are available to the auditor.
b) Attribute sampling. Used when the auditor has identified the expected frequency or
occurrence of an event.
c) Variable sampling. Used when the auditor samples for values in a population which vary
from item-to-item.
d) Judgment sampling. Used when it is not essential to have a precise determination of the
probable condition of the universe, or where it is not possible, practical or necessary to use
statistical sampling.
8) (Refer to Appendix B: Memo to staff)
9) a) Document a procedure guideline which outlines one organisational practice that will
change as a result of the improvement program.
Effect of change
Previous reports have shown that one of the main weaknesses of the respective
company is the process of communication within its premises. Thus, it has decided on
developing an improvement plan in order to restructure its IT systems (Dixon-Woods and
Martin, 2016). The IT department as well as the employees working under different
departments of the company will get highly affected by the change as there are chances
that they show resistance initially while adapting the change as there will be functional
changes as to how the technology works. The effect will take place once the change is
Managing cultural diversity in the workplace23

implemented and the employees have to use the technology in their day to day activities.
The procedure is as follows - Conducting a research – In this stage, a research will will be conducted to get an in-
depth understanding of the area which needs changes. Once the area is identified,
the change can be brought in effectively. Availability of options – After the area is identified, various options that are
available in the market are evaluated and the best suited option is chosen to be
implemented. Evaluation and communication – The option that is selected, is then evaluated for
its efficiency and effectiveness. If it is considered to be effective, the same is
communicated to the employees in a systematic as well as structured manner.
 Implementation and Training – This is the final step as implementation takes place
in this. After the implementation, the employees are provided training as to how
the technology works and can be used on a daily basis.
 Removing Barriers – Whenever a change is implemented, there are chances that the
employees of the company face certain barriers. Thus, once the change is
implemented any issues or barriers relating to it must be corrected so that no issues
rise again in the future and there is a smooth flow of all the business operations.
 Review and Update – The organisation must constantly review and update the same
in order to ensure that the organisation does not lag behind its competitors and is in
sync with the latest trends of the market.
b) All records relevant to this document are to be maintained in a recognised
organisation’s record keeping system at QMS folder @ ‘N’ share drive
Conclusion
From the above report, it can be concluded that change is essential for an
organisation to be successful and gain a competitive advantage. Also, the implementation of
change involves several steps in order to generate effective output. The employees within
the organisation should be provided with right amount of training to ensure that they
actively adopt the change and work more efficiently and effectively.
Recommendation
The respective organisation is recommended to inform its employees if it is planning
to bring in change. It should also consider the feedback and suggestions that are put
forward by them to ensure that the output of the change is more effective and also the
employees don't show any resistance when it is implemented in the system.
Managing cultural diversity in the workplace24

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Managing cultural diversity in the workplace26

Appendix B: Memo to staff
Memorandum
TO: All Staff
FROM: Chief Executive Officer
DATE: 02/02/2020
RE: Potential impacts of the improvement program-Restructure information
technology systems
NAILSMA Limited proposes to seek to develop an organisational improvement program to
restructure its information technology systems, the main purpose of which is for the staff as well as
management to set priorities and allow the various plans of operations to be prepared. The
problem can be solved by conducting surveys, interviews, evaluating existing products or by making
use of “use cases” which will help the organisation in understanding how a particular system will
work.
The five-year Strategic Plan identified the need for NAILSMA to have a considered and
comprehensive information systems strategy in a bid to build credibility, transparency, support,
growth and success.
This strategy’s overall recommendation is to build the NAILSMA brand through better control of its
logo, media relations and stakeholder engagement. Also, the employees of the company should
have effective communication skills which will help them not only in improving but also enhancing
their overall performance. The information on the website should also be updated so that more
people acknowledge the same and one of the staff members should also be assigned the
responsibility of identifying websites on which the respective company should be present. One this
is done, a small description of the respective company should be developed which is based on the
messages that are approved and should be sent to other websites requesting it to be updated and
being uploaded on them.
The initial report in assessing the current information system requirements for the organisation has
been approved by the board. The CFO wants to modernise the use of technology and processes and
reduce overheads. A report has been developed which will help in developing an improvement plan
for the organisation in order to restructure its IT systems. The objectives set by the organisation will
help in motivating the employees and provide them with direction.
Consultations will be held with staff to explain and discuss the proposed changes and how the
implementation will have potential impacts on staff on their daily tasks. Meetings with CFO to be
held are outlined below. The proposed consultation process with staff is as follows:
FIRST MEETING (29 Feb) Meet with staff and explain proposed changes to information
Managing cultural diversity in the workplace27

technology systems and seek initial feedback/respond to enquiries. Correspondence and some
background papers will be distributed together with a copy of the proposal. After seeking the initial
feedback, it will be worked upon and addressed in an effective manner by the management of the
respective company. The management will have the responsibility of ensuring that employees work
in a harmless and risk free environment and will thus be provided with enough resourcing to assist
various issues of health and safety.
SECOND MEETING (15 March) Meet with staff to obtain feedback on proposed changes.
Staff to take responsibility, staff to exercise their initiative, Teamwork and interdependency.
management will look into the purchase process to start replacing and upgrading the program.
THIRD MEETING (30 March) will engage IT system to join in the meeting to discuss what are the
impact on improvement program may affect the work of the staff. Workshop and training will be
conducted for all staff members in the process of installation of new computer systems which will
help them get an idea of how the new technology works.
Important Note: A performance management workgroup, co-chaired by CFO, CEO Audit Executive,
is being formed to review the current NAILSMA performance management process and make
recommendations on a revised process by mid-March. The final implementation to restructure
information technology systems depending upon the recommendation from the workgroup.
If you have questions regarding the impact on the improvement program, please contact or email
CFO.
Managing cultural diversity in the workplace28