August 2020
As the COVID-19 pandemic extends further into the second half of the year, many of us have fallen into a grudging acceptance that disruptions to our home and work routines, once viewed as temporary, could continue indefinitely. It is safe to say that reactions to the global health and economic crisis have unsettled lifestyles, stretched resources, and tested patience and process.
Efforts to manage health and business risks associated with the pandemic have seen varying levels of success. There are differing opinions as to which impacts may permanently change our lives and which are temporary and will disappear as the deadly virus fades in the wake of a vaccine.…
This time of year is typically slow for the release of thought leadership in the internal audit profession. The IIA, internal audit service providers, technology firms, and others normally unleash a wealth of white papers and reports earlier in the year, then there’s a lull before a bevy of fresh new ideas and perspectives once again flows. But 2020 has been anything but typical, with insightful and topical content not ebbing as we navigated the pandemic from our home offices.
At least three publications released in just the past few weeks warrant every internal auditor’s perusal. My old colleagues at PwC published a timeless report in July titled Engaging With the Audit Committee: Five Ways for Chief Audit Executives to Stand Out.…
Almost every week for the past 11 years, I have posted blogs about various aspects of internal auditing. I have covered hundreds of topics and examined dozens of issues confronting the profession, from independence and courage in the face of fire to building stakeholder relationships and understanding the root cause of high-profile scandals. In each post, I hoped to impart some insight and perspective on the roles and responsibilities of internal audit.
As you can imagine, over such an extended period, I saw trends — and priorities — come and go. I marveled at the evolution of the profession, and I discovered some clear truths:
- Internal audit is a key component of sound corporate governance.
Hefty fines levied by U.S. regulators last week in two high-profile cases provide new examples of how ineffective controls can lead to significant problems. One instance was driven by inadequacies in managing cloud computing risks, the other resulted from conspicuous and deliberate rejection of sound governance practices. In one instance, internal audit was part of the problem. In the other, it was a victim.
The best known of the two cases involved Capital One, the Virginia-based bank holding company known for its catchy “What’s in your wallet?” advertising campaign. The bank was hit with an $80 million civil fine from the U.S.…
As we continue to navigate the treacherous risk landscape that includes an ongoing global pandemic, much is being said and written about whether internal auditors are stepping up for their organizations. I am certain we are contributing value during this time, but I also know it may not always be evident — that’s because many internal auditors are not comfortable extolling their contributions in audit committee meetings.
No relationship for a chief audit executive (CAE) has been transformed more in the 21st century than that with the audit committee. According to The IIA’s Audit Executive Center, 90 percent of North American internal audit departments in publicly traded companies report functionally to the audit committee (and 80 percent overall).…