Ateneo - UPO

The internal control (ICS) and risk management system (ERM) consists of the set of rules, procedures and organizational structures aimed at allowing the identification, measurement, management and monitoring of the main corporate risks. The increase in the economic value of a company for shareholders derives above all from the ability to identify and evaluate risks. Only evaluating in time what the foreseeable evolution of one's business may be in the future, identifying the relevant risks and the means necessary to deal with them allows, in fact, the early warning process and helps to manage the difficulties that all entrepreneurial activities inevitably encounter sooner or later, avoiding, or at least reducing, the probabilities of default.
The meaning and breadth of the concept of control varies in relation to the reference environment and is the result of a historical development linked to the more complex field of economic history. In Italian business doctrine until the early twentieth century, the idea of control is understood as verification, that is, as an action aimed at identifying and repressing illicit behavior that is negative for the production and defense of the entrepreneur's wealth. Subsequently, at an international level the National Commission on Fraudulent Financial Reporting, better known as the Treadway Commission, proposed a new interpretation of the internal control system by establishing a working subgroup, called the Committee of Sponsoring Organizations of the Treadway Commission (CoSO) dedicated to the study of the topic.
This course analyzes the result of the work of the Treadway Commission, published in 1992 and known as the CoSO (Committee of Sponsoring Organizations) Report, which still became the reference model for internal control used both by self-regulatory codes and by national and international legislation on Corporate Governance. Particular emphasis is reserved for the risk assessment process adopted by the company aimed at identifying and responding to the risks connected to the activities and the resulting results.
During the course we focus in particular on the examination of the concept of risk, declining it at the level of the entire company operations as indicated in 2004 by the Committee of Sponsoring Organizations of the Treadway Commission in the Enterprise Risk Management (ERM) Framework which represents a evolution (by incorporation) of the CoSO Report.
Testimony from Internal Auditors of two listed companies and one unlisted company will be provided, which will be a valuable opportunity for comparison and in-depth analysis of the topics studied.
At the end of the course, all students are invited to participate to the seminar in English held by prof. Riva and prof. Tirado, (full professor universidad autónoma of madrid & secretary general at unidroit - international institute for the unification of private law). Prof. Tirado will take his speech as UPO visiting professor together with prof.ssa Riva on the topic: "Early warning in Italy & in Europe".

The mandatory reference text, designed and written for this course, is:

- RIVA P., “Ruoli di Corporate Governance. Adeguati Assetti e Sostenibilità”,
Egea, Milano, 2023 – Chapter 6, 8, 9, 17, 20, 22, 24 - First Part

In addition, slides specifically prepared by the professor and the experts invited for this course will be made available to students.

The course aims to help students develop an understanding of: 1) the role of the Internal Auditor in the corporate governance framework; 2) the phases of Internal Audit work, 3) the reference standards and 4) the tools has at its disposal.

At the end of the course the students will acquire an understanding of the topics and the critical issues referring to company strategy, social responsibility and business ethics, in their theoretical and practical aspects and with reference to the national and international dimension.

None
Students who attend the course must know the theoretical framework, the basic terminology and the main tools related to corporate governance. It should be noted that it is therefore desirable that students have already attended the course Corporate Governance (Economic Aspects).

The course includes a total classroom commitment of 15 hours,
equivalent to 2 training credits.
The activities outside the classroom will consist of: 1) the study – possibly in advance - of the lessons indicated in the course analytical – day by day - program (see UPODir) and 2) the group work which will be presented in class with the involvement and participation of the invited Internal Auditors guest speakers; this last activity will be considered part of the final exam and weighted 50% of the final mark for attending students.

Course attendance is optional but recommended as case studies will be presented, experts will be invited to speak and workshops will be conducted. All the above activities facilitate students learning.
The professor will be always available for students by e-mail (patrizia.riva@uniupo.it) and in person at the end of each lesson or weekly by appointment.

ATTENDING STUDENT
The evaluation of the attending student includes:
carrying out an assignment;
a final exam in written form.
The written test must be taken at the end of the course or during the winter exam sessions of the 2023-2024 academic year (and therefore by March 2024). The student who carries out the assignment is considered to be attending. The final evaluation will be divided as follows:
written exam: weight 1/2
assignment: weight 1/2
The group assignment concerns the study of the Internal Audit System of a company chosen by the students and the discussion by the students of the adequacy of what they found to protect the company's viability.
The students will draw up a work project, submit it to the teacher for approval and, if possible, will be invited to set up an interview with the Internal Auditors of the chosen company, thus transforming the group work into real field research.
The formation of the groups will be the responsibility of the students; the number of members of each group will be established by the teacher in the first lesson based on the number of students enrolled in the course. The output of each group work will consist of a written paper in which the following must be clearly identified:
the reason why that company was chosen to carry out its analysis;
the description of the ERM system of the company;
the description of the Internal Audit function;
the assessment of the adequacy or inadequacy of the governance structures found for the protection of the viability.
In the event that the attending student does not pass the final exam, he/she will be able to repeat it in subsequent sessions. However, the assignment grade will remain valid only until February 2024. From March 2024, the assignment grade will no longer be valid and in fact all students will be considered not attending.
Furthermore, 1 point will be assigned to students who will be present at all the course testimonies and at the conference in English organized by prof. Riva (more information will be provided in class).

STUDENT NOT ATTENDING
The evaluation involves exclusively a written exam with a mark out of thirty. A student who does NOT complete the assignment and who, despite having completed the assignment, takes the exam after March 2024 is considered not to be attending.

1. The governance framework in large companies. The reference benchmark.
2. Focus on the differences between the role and function of the Board of Statutory Auditors, the Auditor, the Internal Auditor, the Supervisory Body (L. 231/2001)

3. The role of the Internal Auditor (IA) and the phases of his activity
4. Piquadro case – Company guest speaker

5. Internal Audit principles and tools has at its disposal. Company guest speaker
6. Lavazza case: the Internal Auditor's oversight of the reliability of sustainability information (ESG). Company guest speaker

7. The role of the internal auditor in early warning and turnaround
8. The Fondamenta case. Company guest speaker

9. Presentation of group work

1. Ability to apply knowledge and understanding.
The knowledge acquired during the course must allow the student to use the skills and competences discussed both at a theoretical level by studying the reference models and at an application level through the dialectics set up in lessons with the professor and with company guest speakers. In particular, the student - through planning, processing and when possible interviewing the AI of the chosen company and presentating the group work - will have the opportunity to acquire the technical-economic language of the subject.
2. Making judgments.
The course will allow the student to develop independent judgment on the topic studiend as it will enable the student to express considerations and reflections with reference to: 1) the cases studied in class with the support of the textbook and with the opportunity to dialogue with the companies guest speakers; 2) the exploration of the ICS/ERM systems structured by the company chosen as the target of the group work.

3. Communication skills.
Based on the knowledge acquired, the student will be able to develop communication and relational skills useful for consciously carrying out the typical activities of the role of Internal Auditor in the future

4. Learning skills.
The course will allow the student to understand company dynamics from the Internal Auditor point of view that is using the tools and models typical of the Internal Audit discipline.