PREAMBLE AND BACKGROUND
The Institute of Internal Auditors Indonesia (IIA Indonesia) was established and incorporated as a non-for-profit membership association in Jakarta in 1989.
NAME, LIFE TIME AND LOCATION
The name of this organization shall be “THE INSTITUTE OF INTERNAL AUDITORS INDONESIA”, abbreviated as “IIA Indonesia” or “The Institute”, and incorporated in Jakarta in 1989 based on Pancasila and Undang Undang Dasar 1945 (the Constitution of the Republic of Indonesia). The Institute as used within these Bylaws shall mean the Institute of Internal Auditors Indonesia.
The life time of the Institute is unlimited.
The location of the principal office of the Institute is Jakarta.
The mission of IIA Indonesia is to provide dynamic leadership for the profession of internal auditing in Indonesia. Activities in support of this mission will include, but will not be limited to:
- Advocating and promoting the value that internal audit professionals add to their organizations;
- Providing comprehensive professional educational and development opportunities;
- Promoting and encouraging adoption of The IIA’s International Professional Practices Framework and The IIA’s certification programs;
- Researching, disseminating, and promoting to practitioners and stakeholders knowledge concerning internal auditing and its appropriate role in control, risk management, and governance;
- Educating practitioners and other relevant audiences on best practices in internal auditing; and;
- Bringing together internal auditors from all sectors and industries in Indonesia to share information and experiences.
This Institute is of social nature, i.e. the development of internal auditing profession and is a non-profit organization.
IIA Indonesia is affiliated with The Institute of Internal Auditors Inc. (The IIA or Global IIA) headquartered in the State of Florida, USA.
TERRITORY OF OPERATIONAL ACTIVITIES
The area of operational activities of IIA Indonesia covers all over the territory of Republic of Indonesia.
The Institute might establish chapters within the territory of Republic of Indonesia with adherence to requirements and policies as stipulated by Board of Governors.
The Institute membership shall consist of persons duly admitted to any of the classes of membership, as defined in point 3 of this article, who are domicile in the territory of Republic of Indonesia and in special cases any others not domicile in the territory of Republic of Indonesia.
Members of this Institute are of open nature and are comprised of:
- Those who work as internal auditors and related disciplines;
- Those who are interested in learning further the field of internal auditing;
- Those who once worked as internal auditors.
Membership of this Institute are classified into:
- Ordinary Member: Individuals who work in the field of internal auditing, risk management, internal control, information systems auditing, and related activities, as well as those who directly control internal audit activities;
- Student Member: Individuals who are full time students;
- Affiliation Member: Individuals who are registered as members of Indonesian professional organization affiliated with the Institute.
- Retired Member: Individuals who have retired from the activities as described in the work of Ordinary Member;
- Other Member.
The conferring of Other Member may be determined by the Board of Governors (“Board”) at their discretion upon any person who by virtue of their esteemed position and character in public or business life would enhance the stature of the Profession; or has rendered exceptional services to the internal audit profession.
- Except for the admission of Other Member, all membership for other classes of membership shall be by way of application on a prescribed form;
- All members must pay annual membership fee, except for Other Member;
- Membership is valid for 12 months starting from April 1 to March 31;
- Any exception to the above will be further regulated by the Managing Board.
Acceptance of Standards and Code of Ethics:
- All members are required to comply with The IIA’s International Standards for the Professional Practice of Internal Auditing and Code of Ethics.
Termination of Membership:
- Membership of the Institute shall automatically terminate if a member fails to pay the annual membership fee;
- Resignation with pertinent written application filed with the Managing Board;
- Revocation of membership due to infraction of the internal regulation as laid down in these Bylaws and violations of The IIA’s Code of Ethics. The revocation of the membership shall be valid and effective upon approval by the Managing Board.
RELATIONS AND COOPERATION
The Institute is allowed to enter into mutual cooperation with other professional organizations with respect to its mission as provided for in the affiliation agreement with The Global IIA.
ORGANIZATIONAL STRUCTURE, AUTHORITY AND OBLIGATION OF THE BOARD OF GOVERNORS
Board of Governors together constitutes the governing body of the Institute. In addition to the collective IIA Indonesia responsibilities, each member of the board of governors is given an individual responsibility, such as chairing a committee or having responsibility for one or more specific committees.
Annual goals for the Institute committees should be documented and reviewed with the board of governors preferably before the first regular Institute’s meeting of the year.
The organization structure of the Institute is as set forth below:
The Board of Governors, which is comprised of those elected at a General Membership Meeting, shall include:
- The Managing Board made up of the following:
- Vice President
- Volunteers Group
Immediate Past President, provided he or she remains a member of the Institute, shall be a member ex-officio of the Board of Governors. In the occurrence of absence of Immediate Past President, the person who is acting as President in executing the General Membership Meeting shall be deemed as the Immediate Past President.
Responsibilities of the Board of Governors shall include the following:
Should familiarize themselves with the Institute Bylaws and recent board minutes, including committee reports;
- Should attend every board meeting to recommend actions that are considered to be in the best interest of the Institute. Board member who is unable to attend a meeting should inform the president of their views and suggestions on the material received or on material they wish to have presented;
- Should discuss issues with the Institute membership whenever possible and make the views of constituents known to the board;
- Be responsible for the overall administration , the soundness of the Institute and ensuring the Institute follows its Bylaws;
- Has ultimate fiduciary duty for protecting the Institute’s assets and ensuring good internal controls are in place.
Tasks and obligations of each member of the Managing Board are emphasize in the management aspect of the Institute, and it consists as follows:
- Serve as the main point of contact between the Institute and Global IIA;
- Preside at all meetings of the Institute, the board of governors, and the nominating committee;
- Enforce the Bylaws of both The IIA and the Institute;
- Review the Institute Bylaws periodically;
- Establish Institute goals based on input from other governors;
- Identify and implement services for Institute members to serve the needs of the membership;
- Ensure a succession plan by identifying future leaders positions;
- Chair a transitional meeting at the end of the Institute year to transition outgoing and incoming governors;
- Ensure a sound financial plan for Institute funds with the approval of the board or as authorized by the Bylaws.
- Vice President:
- Perform the duties of the president in the absence or disability of the president;
- Advise and assist the president in staffing Institute committees;
- Perform other duties as assigned by the president.
- Prepare, publish, and maintain all minutes of meetings of the board of governors and the institute;
- Maintain Institute membership records;
- Coordinate publication and mailing lists for meeting notices, newsletters, and directory;
- Establish communication flow concerning Institute member issues among all committees;
- Notify members of all Institute events;
- Perform as corresponding secretary for the Institute.
- Maintain Institute financial records and receive/disburse the Institute funds according to authorization limit that shall be determined by the Board of Governors;
- Implement and maintain financial internal controls;
- Prepare a preliminary budget based on input from committees for approval by the board of governors;
- Prepare monthly financial reports with comparative budget figures for presentation to the board of governors;
- Make financial records available to the institute auditor as required;
- Ensure a sound financial plan for Institute funds with the approval of the board or as authorized by the Institute Bylaws.
Executive Office: The Executive Office shall be the salaried officers led by Chief Executive Officer of The Institute.
Tasks and obligations of Governors:
- Governors that are not member of Managing Board are to direct specific activities of the Institute as determined by the Board of Governors, such as training, certification, membership, research and public -relation.
To support the role of the Board of Governors and its Committees, the day to day execution of the Institute will be conducted by the Executive Office, led by a Chief Executive Officer.
- The Chief Executive Officer, appointed by and accountable to the Board of Governors, is the salaried chief administrative executive of the Institute responsible for the day-to-day operations and staff of the Institute and for the implementation of policies, programs, and budgets approved by the Board of Governors. The conditions and tenure of employment of the Chief Executive shall be determined by the Managing Board, representing the Board of Governors.
The determination of the policies to govern the operational activities of the Institute shall be vested in the Managing Board.
Committee initiates and oversees the promotion of credible and objective internal audit profession as well as enhancing values of internal auditing to management and boards of organizations.
Each committee has the responsibility to recognize the following in its planning and actions:
- The institute’s primary function is to serve its members in fulfilling their professional responsibilities and to serve the profession of internal auditing;
- The committee chairperson has the responsibility to attend Board of Governors meetings as required and present written reports on the committee’s activities. If they cannot attend, written reports should be furnished to the Secretary in advance of the meeting;
- There are benefits of sharing committee and the Institute best practices and products with other institutes/chapters and the respective international committees of The IIA.;
- There is a responsibility for measuring the committee’s progress toward the established objectives.
In addition, committees should recognize the need to:
- Ensure all committee planning and actions contribute to optimal the Institute growth and service to members;
- Prioritize the objectives of the Institute given the resources available;
- Ensure each committee consists of sufficient members to assure that the objectives and responsibilities of the committee are met;
- Evaluate committee members’ abilities for further the Institute service;
- Bring to the attention of the Board of Governors those problems and opportunities that do not fall within the committee’s functional area;
- Keep other committees informed of the committee’s activities and plans;
- Work closely with other institute/chapter committees to ensure the activities are coordinated as necessary.
- An Audit Committee appointed by the Board of Governors, consisting of a minimum of three (3) members who are neither Governor nor paid employees;
- Audit Committee is appointed for a three-year tenure and maybe reelected for another one term;
- The Audit Committee shall be responsible for fulfilling all such duties normally assigned to Audit Committee including but not limited to, recommending to the Managing Board a firm of Public Accountant to review and report upon the financial transactions of the Institute for the financial year;
- The Chairman of the Audit Committee may not serve the Institute in any other capacity during the period of appointment. The Chairman and members of the Audit Committee shall be ineligible for nomination to the offices of President, Vice President, Secretary, or Treasurer for a period of one year after their terms expire. Former member of Managing Board shall be ineligible for appointment to the Audit Committee for a period of one year after leaving the Managing Board.
- The Nominating Committee consisting of a Chairman and at least three (3) other members shall be appointed by the Board of Governors. A member of Nomination Committee shall not be a nominee for any position to be nominated.
- The Nominating Committee must decide a list of qualified nominees for all positions on the board that is open for election based on nominations received from the general membership. Qualified nominees are those members who have been admitted to the Institute at least three (3) months prior to the nomination deadline and have confirmed their interest in serving the position. Such list must be submitted to the Secretary at least thirty (30) days in advance of the date of the general membership meeting. Nominating Committee may decide additional requirement for selecting qualified nominees.
Meetings shall comprise of:
- General Membership Meetings;
- Extraordinary General Membership Meetings;
- Board of Governors Meetings, and
- Managing Board Meetings.
General Membership Meeting is the highest authority in the Institute and shall be held as such place and date as determined by the Board of Governors and shall convened at least once a year. Notice of the meeting shall be communicated no less than 10 days before the date of the meeting to each member entitled to vote at the meeting.
The General Membership Meeting shall:
- Elect the members of the Board of Governors nominated by the Nominating Committee;
- Approve the amendment of the articles of association and Bylaws;
- Receive and approve the accountability report of the Managing Board.
Extraordinary Membership Meeting is convened in extraordinary conditions, held at the request and/or approvals from at least 8 (eight) members of the Board of Governors.
The Board of Governors Meeting is held at least quarterly to review the progress reports from Managing Board and Committees.
The Managing Board Meeting is a regular meeting held on periodic basis at the request of the members of the Managing Board.
QUORUM AND DECISION MAKING
A General Membership Meeting as meant in Article 11 shall be declared at quorum if attended by at least ten (10) percent of the ordinary members. The General Membership Meeting may be delayed for 1 (one) hour if quorum is not reached but at least five (5) percent of the members must be present.
An Extraordinary Membership Meeting as meant in Article 11 shall be declared at quorum if attended by at ten (10) percent of the Ordinary Members. The Extraordinary Membership Meeting may be delayed for 1 (one) hour if quorum is not reached but at least five (5) percent of the members must be present.
The Ordinary Members attending the General Membership Meeting and Extraordinary Membership Meeting as stated in paragraph 12.1 and 12.2 above may be represented by a Proxy.
The Ordinary Members shall elect the members of the Board of Governors at the General Membership Meeting based on the nominations presented by the Nominating Committee for any board positions that are expiring.
NOMINATIONS, OFFICE TERM, ELECTIONS, REMOVAL,AND REPLACEMENT
Nominations shall be made by the Nominating Committee as described in section 10.5. The slate of nominees must specify the position for which they have been selected and published to the members at least seven (7) days prior to the meeting called for purpose of elections. In addition, nominations can be made by members provided such nominations are submitted in writing by no less than fifty (50) members and received by the Nominating Committee at least 15 days prior to the meeting called for the purpose of election.
The Board of Governors is elected by the Ordinary Members for a term of 3 (three) years.
All Governor shall be elected at a General Membership Meeting of the Institute, shall take office upon election and shall hold office for the term to which elected unless their terms of office shall terminate or be terminated as provided elsewhere in these Bylaws. The election of Governor shall be made an order of business at any duly held regular or special membership meeting following the annual meeting in which members fail to elect such governor, provided that due timely notice that such action is to be taken shall be given to the members, in writing, in advance of such meeting.
Governor shall be eligible for reelection except that the President shall not serve more than two (2) terms.
Removal for Cause:
Any governor can be removed for cause by a two-thirds vote of the Board of Governors, provided such governor shall has been granted an opportunity for a hearing before the Board.
The resignation of any governor shall be tendered to the President of the Board.
If any vacancy shall occur in any office or directorship by reason of death, resignation, or otherwise, the President is empowered to fill such office pro tem until the Institute elect a member to fill the said vacancy at the next regular or special meeting of the members.
Termination of Membership:
If the membership of any governor shall terminate or be terminated for any reason, the office shall automatically become vacant. However, the membership of a governor cannot be terminated by action of the Board while such member holds an elective office.
Finances shall be obtained from:
Proceeds from the organization of IIA certification examination, training, seminar, conference, and from other activities that have been entered into the Institute program by the members of the Managing Board;
- Publication of magazines, reports of scientific nature research result, books, and the like.
The Institute’s financial year shall be from 1st January to 31st December in the same year.
- Membership fee shall comprise an annual fee and shall be determined by the Managing Board;
- Persons admitted to membership during the course of the financial year shall be liable for the fee appropriate to their class of membership.
- The annual fee is payable in April each year.
The Managing Board shall appoint the Executive Officers of the Institute and such other officials as the Managing Board may deem necessary on such terms and conditions as to remuneration and otherwise as the Managing Board shall think fit and may remove any of them. Subjects to these Bylaws, the Managing Board shall determine the duties of the Executive Officers and such other officials.
INTERPRETATION AND AMENDMENT OF BYLAWS
All questions of interpretation of the Bylaws shall be decided by the Board of Governors.
Amendment of the Bylaws of the Institute may be proposed at meeting of the Board of Governors. If approved by a majority vote of the Board members present at the meeting, each proposed amendment to the Bylaws shall be submitted to the General Membership Meeting for approval; and if approved by a majority of the members voting (in person or by proxy), it shall then be declared by the President to be effective.
AFFILIATION & LOCAL CHAPTER
The Institute may establish an affiliation to expand its presence and membership service coverage in the form of Local Chapter or accepting affiliation proposal from other professional organizations.
Affiliation proposal shall be submitted to Secretary of the Institute and subject to approval from Board of Governor of the Institute. The proposal terms and conditions will include (but not limited to) membership benefits and status, joint events and others in a mutually beneficial relationship.
New Local Chapter establishment prepared by the organization development committee. A prerequisite of Local Chapter establishment include the following:
Minimum of 30 Institute members in the city/area of Local Chapter.
Minutes of initiation meeting of the establishment of Local Chapter
A proposed name of Local Chapter’s President and Managing Board (following the structure of Institute’s Managing Board).
A proposed charter of establishment consists of rules of relationship with the Institute, code of conduct, responsibilities of Local Chapter’s Managing Board, and financial agreement with the Institute.
Establishment and dissolution of Local Chapter shall require approval from Board of Governors.
Dissolution of this Institute shall be subject to Extraordinary General Members Meeting.
On dissolution of the Institute, any funds remaining shall be distributed to The Institute of Internal Auditors, Inc.
Anything not yet provided for in the Bylaws will be trusted to the discretion of the Board of Governors to the extent of conformity with this Bylaws.
This Bylaws shall be effective as of the date of promulgation.
All previous and existing deeds and bylaws are superseded by this Bylaws.
Regarding everything referred to above and any legal consequences of the implementation thereof the appearing parties subject themselves to the Jakarta District Court.
IN WITNESS WHEREOF:
This Bylaws are drawn up and executed in Jakarta, on ……. and date……………., in the presence of:
This Bylaws having been duly read out by me, Notary, to the appearing parties and witnesses, was immediately signed by the appearing parties, witnesses and me, Notary.