You have recently accepted the position of chief audit executive at Hitech Circuitry Inc., a large

international manufacturer and distributor of complex computer circuits with its head office in Burlington, Ontario. The company competes in a market in which technical innovation is the most important key to success, with quality control and marketing the next most important factors. The company markets extensively on the Internet and has up-to-date software to accept and process sales orders electronically.

The staff of your internal audit department consists of 12 qualified accountants, all recruited directly from public practice accounting firms. Eight of them work at the company's Canadian head office and the other four at strategic locations throughout the world to enable them to audit the company's overseas activities.

During your first week at work, you come across the department's policy and procedure manual, which includes the following:

1. When qualified accounting staff members in the controller's department are on vacation, staff members from the internal audit department will act temporarily in their positions to ensure that controls continue to operate effectively in the absence of the regular staff. (2 marks)
2. Internal audit staff shall be paid a bonus each year based on the savings generated by the implementation of their recommendations. Such bonuses will be calculated as a percentage of the savings during the 12 months following the issuing of the audit report containing the recommendation. The manager of internal audit will verify the amount of the savings and will receive a bonus equal to 10% of the bonuses paid to the other members of the department's staff. (2 marks)
3. The manager of internal audit is expected to spend a minimum of eight weeks each year abroad reviewing the work of the internal auditors in the company's overseas locations. (2 marks)
4. Because of the need for confidentiality, all internal audit work shall be performed by members of the department's staff. (4 marks)

Required

Comment on the appropriateness of each of the statements from the policy and procedure manual, stating whether you believe that the policy or procedure violates the IIA's International Standards for the Professional Practice of Internal Auditing.

Use the following table format for your answer:

Violation or not. State Yes or No	Explain Why.
a
b.
c.
d.