February 2022
Following weeks of ominous intelligence reports, the world once again finds itself grappling with a destabilizing geopolitical event – this time on the European continent itself. When Russian forces rolled into Ukraine on Feb. 24, it was not totally unexpected. Yet, when 2022 risk assessments were being compiled in recent months, this was a risk few saw coming. The World Economic Forum’s 2022 Global Risk Report, published a little over six weeks ago, acknowledged increased tensions but did not include armed conflict between nation states or geoeconomic confrontation among its top 10 global risks in the next two years. And geoeconomic confrontation barely made the top 10 list for the decade ahead.…
I have always enjoyed working with new internal auditors, in part because they so often see the world in black and white. “Should we do an audit?” “Should we issue a finding?” “Am I maintaining a healthy degree of professional skepticism?” For many new internal auditors, each of those questions points unerringly to a single yes-or-no answer.
With experience, internal auditors’ horizons expand, and they start to see repercussions of our actions. The issue is not merely whether we should perform an audit, but whether there is enough risk to warrant one, how extensive an audit is justified, and how soon it is needed.…
My recent blog, “Five Things Not to Say When You Are Starting an Internal Audit,” was far and away the most popular I have written in years. The overwhelming response provided reassurance that most internal auditors strive for constructive relationships with their clients. They realize that internal audit’s value depends heavily on how our audit results are received by the intended audience. If there is friction between internal audit and the client, our ability to persuade is negatively impacted.
As my blog pointed out, the opening meeting can generate unintended tension. But I suspect many of you will agree that a much more likely source of friction is the final audit results.…
I was recently speaking with an old colleague who is now chief audit executive of an American company. She was lamenting how “testy” management seems to be with internal audit these days. She observed that before the pandemic, the opening meetings for new audits used to be a positive experience, but that there seems to be more tension in virtual meetings today. I quizzed her about the meetings, and asked her if there are triggers that derail the meetings? She shared some examples of exchanges between her audit teams and management that seemed to raise the ire of those whose areas are about to be audited.…
Earlier this week, the legendary American pro football quarterback, Tom Brady, announced his retirement. That was big news because, at 44 years old, Brady was considered by many as one of the best NFL players in history. He holds nearly every major quarterback record, including passing yards, completions, touchdown passes, and games started. He never played in a losing season, and is the NFL leader in career quarterback wins, quarterback regular season wins, and quarterback playoff wins. In his final season, Brady was still playing at an extraordinary level. He set an NFL record for pass completions and became the oldest player ever to throw for more than 5,000 yards.…