Regular readers of my blog understand the emphasis I place on internal audit’s role in helping organizations achieve their objectives. It is integral to the Definition of Internal Auditing and is at the core of what we do as professionals. No matter where we perform our duty as internal auditors, serving the organization must be ingrained in our DNA.
There is a large part of the internal audit community where this is particularly and peculiarly so: the public sector. There are unique challenges for public-sector auditors that relate to serving organizations that, in turn, serve the public and public good. Among the most selfless men and women in our profession are those in public service.…
The number of shocking corporate scandals that have damaged major corporations reads like part of a top 10 list of news events from the past decade — Toshiba’s accounting debacle, Volkswagen’s dieselgate, Wells Fargo’s fake accounts, Carillion’s collapse, Nissan’s CEO salary fiasco.
All proponents of good governance — from investors to regulators to compliance and risk managers to providers of independent assurance — should be deeply troubled by these high-profile scandals. What’s worse, these examples of governance failures have a common and troubling subplot: In every case, the boards of these mature and highly sophisticated corporations were largely in the dark about the extent of significant risk management flaws that eroded shareholder value.…
Against a backdrop of numerous high-profile corporate scandals, boards of directors around the world are facing increasing pressure to perform. Activist investors, changes in technology, and increasingly aggressive regulations are bearing down on corporate leaders like never before, and the dynamics of macroeconomics and geopolitics only add to their complex challenges.
The seemingly overwhelming task of operating a modern corporation can be greatly eased, however, by competent and creative executive management, strategic risk management, and independent assurance from internal audit. Yet, this tried-and-true formula for successful corporate governance often fails when the key players aren’t aligned or, worse yet, have conflicting agendas. …
At my age, the dawn of a new decade should not be that big of a deal. After all, the middle of the coming decade will mark 50 years since I shed my college graduation gown and went to work in internal auditing. Since that time, I have watched the calendar turn to a new decade four times. Each time, I tried to imagine what the coming decade would hold, and each time, events unfolded that no one could have foreseen. The OPEC oil embargo in the 1970s, the fall of the Soviet Union in the 1980s, the explosion of the Internet in the 1990s, the global financial crisis in the 2000s, and the explosion of social media in this decade all had profound impacts on the world in which we live and work.…