​Real-world Education

A university and health-care company partnered to create an internal audit internship program that equips students to hit the ground running.

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Business schools across the country emphasize the importance of hands-on learning experiences via internship programs. Internal audit internships can provide students with an understanding of the business as a whole, allowing interns to get a clearer idea of areas that interest them. Additionally, internships in internal auditing expose students to various functional areas within a company so they can experience different career paths outside of their degree or major. 

With an ambitious timeline for developing internal audit programs for multiple departments, Professional Physical Therapy (PPT  — an outpatient therapy provider in the U.S. — first collaborated with Hofstra University in Hempstead, N.Y., to offer a summer internship program in 2017. The goal of the internship program was not only to attract high-quality graduates to PPT, but to attract candidates to the internal audit profession. More specifically, the objective of the internship program was to give students an opportunity to gain experience in the internal audit department of a large health-care company and refine their critical thinking skills as they relate to compliance and internal auditing. Unlike other internships that give detailed instructions on each task to be performed, this program was intended to give interns considerable autonomy.

As part of the program, PPT wanted the interns to develop department-specific audit tools for human resources, marketing, business relations/sales, and finance and accounting that were statistically viable and measured the overall performance, functional task compliance, and inherent risk associated with each department. Other objectives were to determine functional variability and level of error or noncompliance with legal, regulatory, operational, industry, and firm standards. 

Selection and Onboarding

Hofstra faculty chose eight high-quality undergraduate and graduate student internship prospects. After interviewing with PPT’s director of internal audit and chief compliance officer (CCO), all eight students were offered paid internship positions. The interns comprised four graduate students and four undergraduate students with majors in accounting, legal studies in business, biology, and marketing. 

In the first week, interns participated in an orientation training boot camp. They were introduced to PPT staff and provided with an overview of the program, health-care internal audit best practices, and the organizational charts of the four departments to be audited. To help the interns understand what an audit looks like, they were provided with an overview of the PPT clinic and revenue cycle operation audits (i.e., how they were developed, scoring, performance, reports, and corrective actions). Interns were then assigned to one of the four departmental internal audit teams and provided work stations.

Next, interns were assigned to project managers/mentors from the legal and compliance department in teams of two. Because the internship program took place in the health-care sector, interns were also provided with an overview of the U.S. Health Insurance Portability Accountability Act. Then they were trained on how to develop internal audit tools and given goals and deadlines for deliverables.

Guidance was given on how interns could access relevant information to achieve their objectives. For example, they were given job descriptions of individuals in the departments to be audited, relevant forms and policies, and the necessary steps to develop an audit tool. Also, interns were told they would be interviewing staff in the various departments to learn about departmental processes and role-specific job requirements. The legal and compliance team explained legal issues relevant to health care and the audit process using an actual clinic audit, sample audit report, and corrective actions. 

Finally, each audit team developed a 60-day plan that was reviewed by a mentor, conducted mock staff interviews to illustrate how interns should interview PPT staff, and learned how to research industry standards and best practices. Interns met with their mentors, who gave an overview of the timeline for internship components, including research, interviews, policy review, document review, internal audit tool development, testing, measurement and weighting, and audit performance.

Audit Tool Development

Teams were assigned to specific departments based on interns’ educational backgrounds and interests. The goal of having two-person teams was multifaceted. The interns were able to work as autonomous teams, while mentors provided guidance as needed. However, the interns relied on each other’s strengths to a great extent to achieve objectives before resorting to their mentor for guidance. This helped build interns’ self-confidence and reduced heavy reliance on mentors in the program. 

The interns’ first task was to gather research by reviewing industry and firm standards, firm policies and procedures, and relevant laws and regulations, and by interviewing respective department personnel. Each team’s mentor reviewed the information and aided or provided feedback to the interns as needed through the research process. 

Once the research process was complete, the teams developed the audit tools, which consisted of binary questions that could easily be scored and weighted. Audit tool question development went through multiple steps of evaluation over a four-week period. First, the audit tools were approved by the project manager/mentor. Next, they were approved by the director of internal audit and then the CCO. Once a team received final approval, the interns conducted an audit using their newly developed audit tool. Based on those findings, the teams created key performance indicators (KPIs) and a KPI dashboard for each department audited. 

With results from the audit and KPI information in hand, the interns prepared an audit report summarizing their findings. Interns also conducted a gap analysis and provided an action plan based on its results. Finally, each team prepared a presentation of its audit findings and presented them to PPT’s executive board. 

Company Benefits

The program allowed for an ambitious project of developing audit tools for continued use for four departments, and it was completed in a relatively short time frame. Furthermore, the review process in place (i.e., by mentors, the director of internal audit, and the CCO) ensured that the output of the program was of high quality. Because interns were responsible for the development of each department audit tool from start to finish, the project cost much less than it would have cost had it been performed by legal and compliance personnel.

The PPT internship program was such a positive experience for the members of the legal and compliance departmenets that PPT decided to hire one of the interns in a full-time capacity. Due to the success of this internship program, PPT’s director of internal audit and CCO indicated interest in pursuing additional internships in the future. 

The internship program increased exposure to, and promotion of, the company through the interns. By providing a positive and satisfying learning experience for the interns, the company receives positive publicity spread by the interns to their peers.

Student Benefits

Because each team was responsible for a project from start to finish, they were able to improve their critical thinking skills considerably by way of firsthand learning. By providing each intern with autonomy — and another intern to work closely with — they were able to bounce ideas off of one another to solve problems and achieve their objectives. Interns used critical thinking skills at every stage of the internship program: research, development, execution, reporting, and presentation. In addition to improved critical thinking skills, interns also refined their technical skills by using Excel tools and learned a great deal about health-care industry standards, departmental company standards, and best practices. 

However, one of the greatest outcomes of the program was the opportunity for the interns to develop their communication and soft skills by placing them in real-world situations. Interns learned how to develop good rapport with company personnel, work efficiently as a team, capitalize on each other’s strengths, and work under pressure. Feedback provided to the interns from mentors resulted in significant improvement in these areas. As a result, this internship program created much more desirable job candidates.

Interns in the program completed a mid-internship self-performance appraisal form where many indicated they were able to apply knowledge from their university studies to a real-world setting, learned a great deal about areas in which they had very little previous knowledge, identified technical and presentation skills as being enhanced, and expressed that their communication skills improved. While several interns were frustrated with the real-world phenomenon of different expectations from different supervisors, they learned to cope with these sometimes-contradictory expectations. This reflects a clear acknowledgement of improvement in soft skills in the workplace. 

The interns also identified gaining work experience in the health-care industry, working independently and within a team, and being responsible and accountable for work performed as additional benefits of the program. After presenting their findings to the executive board, interns indicated they felt a great sense of accomplishment and self-satisfaction.

Changing Perceptions

Internship opportunities in internal auditing that create positive experiences for the interns and the organization can work to enhance perceptions of the internal audit profession. Students share their experiences with peers, which can translate to increased interest from students looking to learn more about internal auditing. Additionally, organizations may see an increase in high-quality candidates who may have never considered a career in internal auditing.  

Rina M. Hirsch
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About the Author

 

 

Rina M. HirschRina M. Hirsch<p>​Rina M. Hirsch, PHD, CPA, is an assistant professor of accounting at Hofstra University in Hempstead, N.Y.<br></p>https://iaonline.theiia.org/authors/Pages/Rina-M.-Hirsch.aspx

 

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