2021

July 26, 2021

Internal Auditors: It’s What You Say – AND How You Say It!

We live in a world today where the words we choose are more important than ever. An insensitive comment made today is likely to elicit a much different response than the same choice of words would have garnered just a few years ago. People are sometimes rightly offended by the actual words that are used, but other times it is the unintentional tone used in delivery that elicits a negative reaction. For those of us who are career internal auditors, we understand that tone in our communications is vitally important.

As the old saying goes: “It’s not what you say, it’s how you say it.”…

July 18, 2021

Courageous Internal Auditors Are Storm Chasers

As the world slowly emerges from the historic Covid-19 pandemic, I have been giving a lot of thought to the lessons the internal audit profession should take from the past year. One observation has been that those internal auditors who rolled up their sleeves and helped their organizations rally in the face of unprecedented disruption have fared the best. They won or sustained the support of their key stakeholders, and can take pride in knowing the value they delivered. From the conversations I have had with these internal auditors, I have been impressed by their passion, courage and innovation. While some in the profession kept their heads down and followed their audit plans developed before the pandemic, the courageous internal auditors sought out the turbulence their organizations faced and sailed toward the storms.…

July 12, 2021

5 Steps to Avoid Career Burnout

As we emerge from the great pandemic, a lot of predictions and “buzz phrases” are being thrown around. One that recently captured my attention is “the great resignation.” Texas A&M professor Anthony Klotz is credited for coining the term, and Bloomberg Business Week recently interviewed Klotz as part of an article titled: How to Quit Your Job in the Great Post-Pandemic Resignation Boom. According to the article:

“The great resignation is coming,” says Anthony Klotz, an associate professor of management at Texas A&M University who’s studied the exits of hundreds of workers. “When there’s uncertainty, people tend to stay put, so there are pent-up resignations that didn’t happen over the past year.”

July 5, 2021

Six Signs You May Be the “Internal Guard-it” Department

Traditionally, internal audit was seen as a value protection element in the organization’s system of risk management and controls. It helped organizations protect value through a heavy emphasis on assurance on the effectiveness of financial, compliance and operational risks. However, over the past 30 years, internal audit has undergone a number of transformational changes. The late 1990’s brought greater emphasis on consulting and advice in addition to traditional assurance engagements. In the early 2000’s, The IIA Standards were revised to emphasize risk-based auditing to require internal audit undertake a risk assessment at least annually as part of its audit planning process.…

June 28, 2021

How Internal Auditors Quietly Foster Trust in Capital Markets

Five years ago this week, I had the distinct privilege of joining several IIA colleagues on the podium of the New York Stock Exchange (NYSE) to ring the opening bell. This once-in-a-lifetime experience was one of the highlights of my 12 years as The IIA’s CEO. It’s a memory I cherish for many reasons, not the least of which was the NYSE’s acknowledgement of The IIA’s 75th anniversary. This year The IIA is celebrating its 80th anniversary, and it’s an appropriate time to remind ourselves what this profession does to foster trust in institutions around the world.

I retain many vivid memories of the NYSE ceremony on June 30, 2016, but one that I have replayed in my mind many times occurred behind-the-scenes before the opening bell.…

June 16, 2021

How Space Aliens Factored Into my Most Controversial Audit

This week, members of the United States House Intelligence Committee will receive a classified briefing on a topic of universal and enduring controversy: Unidentified Flying Objects (UFOs). Throughout history humans have been in awe of celestial bodies beyond our own. The curiosity about extraterrestrial life often stimulates fierce debate. Twenty years ago this week, I came to appreciate just how passionate people can be about the subject of alien life.

​As the inspector general (IG) of the Tennessee Valley Authority (a U.S. government owned corporation), I was responsible for the audit and investigative functions of the company. Shortly after I became IG, we reported a cybersecurity breach that had allowed an unauthorized third-party access to our network after hours.…

June 14, 2021

For Some Audit Reports: It’s Better Never Than Late

I recently heard from an old acquaintance that I had worked with as an internal audit colleague years ago. He eventually moved on, and today holds C-suite assignment in a large company. He reached out to me because he had just received an internal audit report on his area of responsibilities that included a number of critical findings. He wasn’t contacting me about the substance of the report (some of with which he strongly disagreed). Instead, he was lamenting that the audit had taken three years to complete. Yes – 3 years! Yes – 36 months! Yes – 1,095 days! He knew my reaction before he even asked.…

June 7, 2021

In the Face of Dire Cyber Threats – Internal Auditors Should Seize the Home Field Advantage

In October 2019, I authored an article titled: Ready or Not — Here Come the 2020s in which I offered my predictions for the decade ahead. Included on my list was the following: “The principle driver of cybercrime will evolve from direct financial gain to personal and political manipulation…. cyber criminals have shown a troubling talent for finding new ways to leverage technology. With the imminent launch of 5G wireless technology and the explosion of data it will create, cyber criminals will assuredly find exotic ways, both brazen and covert, to influence what we hear, see, and possibly do.” While the vast majority of cybercrimes still include a financial motive, events of the past month have proven all too well that cyber criminals can disrupt our everyday lives and influence “what we do.”…

May 31, 2021

5 Reasons People Stay in Toxic Cultures

In a recently published blog, I discussed why internal auditors need to use more than their senses of sight and sound when auditing culture. I quoted a respected corporate director from India who has observed that we must also use our sense of “smell.” Following publication of the blog, a former colleague reached out to me and asked: “Isn’t a clear indication of ‘toxic culture’ the fact that employee turnover is high? Don’t people just leave if the culture gets too bad?”

It was a good question, but it was also a topic I wrote about in 2018. The fact is that many people do leave toxic cultures.…

May 24, 2021

Auditing Culture Also Requires a Sense of “Smell”

When I launched my internal audit career, the idea of auditing the “softer” side of an organization’s culture was anathema to the profession. Back in the day, it was believed internal audit should focus on hard controls, such as policies and procedures. If we strayed into any area touching on culture, we still focused on hard controls such as codes of conduct or human resources policies. Evaluating concepts as intangible as trust, ethics, competence, and leadership styles was something for psychologists and pop-culture gurus to worry about. In retrospect, a lot of heartache and failure across a multitude of organizations might have been prevented had internal audit taken on the full spectrum of culture 40 years ago.…