As an internal auditor, your role involves many moving parts. Deliver relevant, timely, and meaningful information to key stakeholders? Check. Build and maintain a productive team? Check. Leverage technology to quickly identify where controls might be weak or absent? Another check.
If only attending to all the details and standards of the profession were as simple as checking items off your to-do list! To help you rise to the challenge, you’ll need to find a way to focus on the details without losing sight of the big picture. Start by keeping these seven critical performance areas in mind each year:
Most organizations are proud of their past successes and their way of doing business. That’s fine—but great internal auditors lead by discovering the information that is relevant to the future. Start with the fundamentals and make a thorough study of the organization’s written plans. The existing audit charter is always a great place to start, along with any policies and procedures concerning organizational control. But don’t stop there.
Spend some time digging into investor presentations, road maps for the various products and services, and marketing analyses. Go back a few years to see how the company’s objectives and goals have evolved. What has the organization done to actually achieve these goals? Have any of them fallen by the wayside? Do they make sense in the real world in which employees and customers actually operate? From your position as the person without the rose-colored glasses, you can help ensure that important initiatives are sustained after the initial hype has faded.
When you keep up with technology, you give yourself a tremendous advantage over those auditors still using tools that were current a decade ago. With the power of data analytics and continuous monitoring, the audit universe has expanded. By investing your time in mastering modern, purpose-built tools like IDEA, you become the go-to person for real-time, relevant metrics about operational issues, compliance, and fraud.
Annual planning and preparation are your best opportunities to build a strong, across-the-board internal auditing effort that safeguards company assets, puts the spotlight on operations, ensures compliance, and evaluates for fraud and other risks. So far so good—but to take it to the next level, consider what you’ve learned about the organizational goals and strategies. Top internal auditors spend time continuously considering their audit charter and determine when updates are needed to reflect current priorities. With thoughtful consideration, you can create an excellent plan that “dives deep” on the most relevant data and processes (revenue, expansion of the customer base, volume of transactions, etc.). Then create data analytics up front to monitor these areas. You should end up with some very illuminating reports and risk assessments.
All internal auditors have a duty to perform their work with care and competence. One of the unique aspects of our profession is the obligation to maintain strict independence and objectivity, even in regard to your own employer. The internal auditor is neither an advocate nor an adversary. World-class auditors revisit the IIA Standards and Guidance framework regularly and keep up with the evolving standards for dealing with cyber risks, the rapidly evolving regulatory environment, and the desires of audit committees and boards of directors.
As you build your professional reputation, you’re likely to find yourself with ever-increasing responsibilities, including hiring, managing, and coaching direct reports. In today’s challenging environment, auditing will challenge your creativity, and surrounding yourself with the best minds can only help. Consider the range of expertise you need for your team. Internal staff will know the culture of the organization, and those with industry experience will contribute knowledge of the regulatory environment in which the organization operates. For specialized jobs, you may need to hire independent contractors.
Regardless of the permanent or temporary nature of your staff relationships, your success depends on theirs. Don’t cut corners on investing the necessary time to find, hire, and place each person where they can perform valuable and important work. Remember that most people will go the extra mile for someone who actively listens to them and respects what they do. Leading a credible and respected team is a giant step in the professional growth and reputation of any auditor.
Have you ever heard the saying that 80 percent of solving a problem consists of convincing others that the problem even exists? Auditors have the unique role of gathering and reporting both good and bad information. One key to becoming a world-class auditor is having an open door policy to receive information that might be too sensitive or confidential for employees to take into the c-suite. By being available and approachable, auditors can be “in the know” about issues within the organization. Timing and relevance of communications is critical. You should meet with CEO and committee regularly to avoid unwanted surprises. However, serving as the go-to person for information doesn’t necessarily require you to reveal everything. Prioritize issues that require organizational attention and changes.
In the eyes of senior managers, a successful audit will focus on findings and recommendations that make a great thing even better or turn around a disaster area. When you identify a critical risk (or opportunity), issue a management letter right away, and provide updates quickly. And let’s face it—not everything can be on the executive radar screen at any given time. For other issues, lead the way with communication protocols based on levels of concern—and set up a continuous flow of data analytics to address issues proactively rather than reactively.
Like any good employee, an internal auditor feels responsibility for the company’s mission, fellow employees, and the customers. But ultimately, your most important relationship will be with high-level stakeholders, especially the chief executive officer. Without his or her buy-in, you will not have the support and cooperation you need for success. Establishing regular communication with the CEO is one of the most important activities you can undertake. On a regular basis, make sure you check on executive expectations and use them to set the objectives and deliverables for you and your team.
Other “customers” for audit are the C-level managers, the board of directors, and the audit staff of your organization. To win their support, you need to understand the risks, problems, and opportunities facing the organization as they see them. You should also establish relationships with external auditors and discuss the internal control issues that they may have identified during their reviews. Remember that what gets measured gets done, so revisit these attributes each year to help hold yourself accountable. Becoming a great internal auditor takes more than following a checklist—each individual and each organization is different. By embracing the full spectrum of the activities and habits of truly great auditors, you can build a career that is meaningful to your organization, a credit to the profession, and full of growth and purpose for yourself.