April 2014

I recently spotted the headline “Is Internal Audit Losing Value?” in a respected business journal. It was for an article based on survey results in one of the multitude of white papers on the internal audit profession that come out around the first quarter each year. Researchers indicated that a greater number of managers are questioning whether they receive “significant value” from internal audit.

The survey found that 68 percent of board members believe internal audit adds “significant value,” while 65 percent believe it “performs well.”

Is there room for improvement? Absolutely. But, when I read headlines that suggest internal audit is perceived as providing less value, I am reminded of the favorite retort of ESPN sports broadcaster Lee Corso — “Not so fast, my friend!”…

I was recently interviewed about internal auditing by Federal News Radio, an AM and Internet station out of Washington, D.C. That interview was a great opportunity to represent the internal audit profession, but it also turned out to be an important reminder for me about just how internal auditors are often perceived.

The host opened the interview by saying, “Meet an auditor at a cocktail party, and you might decide you suddenly need a fresh drink.”

While the radio host was clearly engaged in a bit of levity, there may be more than a grain of truth in his portrayal of our reputation.…

Generally speaking, I think internal auditors do a good job of assessing risks and developing risk-based audit plans. But there is always a danger that unfamiliar risks may be overlooked or that rapidly emerging risks will render even the best crafted audit plans obsolete. If you typically undertake risk assessments only once or twice a year, you may not have incorporated several risks that have suddenly burst onto the radar of management or the board of your organization.

Here are some areas that should be in our risk cross hairs in 2014:

1. Cybersecurity Frameworks. I know you’ve heard it before: Cybersecurity is a huge area of concern, ranking near the top of nearly every list of business risks for about a decade.…

On the surface, opportunities for internal auditors seem to be better than ever, with great prospects for career advancement. We are in a growing field and, because turnover rates are relatively high, new supervisory and management positions are constantly becoming available. As well, internal auditors are able to make important job contacts through their organizations, and many doors are open to us.

But it’s not all good news, and that could be our own fault. We may be doing a disservice to the rising generation of career internal auditors by actually limiting opportunities for advancement, despite our best intentions.

Advancement into audit management is very achievable these days, but getting a job as a chief audit executive (CAE) might be more difficult for career internal auditors than most of us would have imagined only a few years ago.…