logo-newlogo-newlogo-newlogo-new
  • Home
  • Blog
  • Audit Trail Academy
  • Advisory Services
  • Books
✕
  • Home
  • Chambers on Internal Audit
  • Uncategorized
  • Audit Reporting at the Speed of Risk: 4 Strategies for Success

Audit Reporting at the Speed of Risk: 4 Strategies for Success

Independent Federal IGs Are Essential to Effectiveness and Integrity
June 1, 2020
What New IIA Survey Reveals About Pandemic’s Impact and Year Ahead for Internal Audit
June 15, 2020
June 8, 2020

reporting-at-the-speed-of-risk

News last week of improvement in the U.S. jobless situation brought a glimmer of hope that, perhaps, the very worst may be behind us. At least for now. But disruption continues to engulf our personal and professional lives, as the twin impacts of the coronavirus COVID-19 — health and economic — reach ever deeper into virtually every organization on the planet. Internal auditors are wrestling with risks that continue to emerge at warp speed and myriad challenges from working remotely, exasperated by a lack of crucial face-to-face communications.

However, by all accounts, the profession is demonstrating agility and proving its resilience.

Much has been said and written about how internal auditors are adapting: how we are using technology, how we are auditing remotely, and even how we are providing assurance and advice related to health and safety risks. But one topic has been conspicuously absent in conversations about how internal auditors are innovating: how we are reporting our audit results. 

COVID-19 has taught us a lot about the impact on modern organizations when disruption is so swift and complete. The shelf life of critical information for timely decision-making has been reduced dramatically. Even in the best of times, our audit reports often take too long, diminishing their value. The average turnaround time for internal audits in many organizations is six weeks or longer. Just finalizing and publishing a report can consume as much as a third of an internal audit’s cycle time. Imagine how out-of-date an internal audit started six weeks ago would be today. There is likely no excuse, especially if supporting data was collected and analyzed more than two weeks ago!

I have been advocating for swifter audit reporting for more than 20 years. I even dedicated three chapters in my book, The Speed of Risk, to timelier auditing. But there has never been a time other than now when reporting audit results swiftly has been more critical. As I noted in my book:

Given the speed at which risks emerge and can wreak havoc, internal audit departments should have zero tolerance for slow reporting processes. Failure to deliver a final report after it’s too late for the results to avoid further impact is not an option. That’s not even protecting organizational value, much less enhancing it.

So, what advice would I offer for more timely report results? I offer four strategies.

  1. Share the results as the audit unfolds.One of the most frustrating delays in finalizing an audit report is negotiating with the client on the wording and tone of our observations and conclusions. Clients often push back intensely against an audit report when they are seeing all of the results at once. Providing results incrementally can help mitigate the shock. Once the internal audit team gets to a point in the engagement when it is satisfied there is a reportable condition or something management needs to address, share the information right then with the client — either informally or through a written, interim update. Regular communication during the audit not only reduces the potential for friction at the end, but more importantly it enables timelier corrective measures.
  2. Reduce or even eliminate levels of review for draft results.The larger an internal audit department, the more levels of review reports often must undergo. Multiple levels of review within the internal audit department are often a major source of delays in audit reporting. Streamlining the review process and reducing the number of reviewers inevitably accelerates the reporting process.
  3. Collaborate to expedite. Bringing the audit team together with all of those who will edit or review the draft report for a single editing session also can reduce a report’s cycle time dramatically. This allows the internal audit team and the department’s upper-level supervisors to discuss the draft and propose changes without the endless back and forth of the usual editing process. I used this “team editing” approach with great success in internal audit departments I led in the past.
  4. Reimagine reporting.This is the 21st century, yet our reports can look and feel as if we banged them out on a Selectric typewriter. We live in the era of tweets and text messages, yet we still write reports that look and feel like college term papers. Get creative with the objective of conveying the information as swiftly and concisely as possible. Yes, we must document the results of our audits, but a typical internal audit report goes far beyond conveying results. Streamline the report down to bare essentials, and measure performance on the timely impact the report has — not the number of words or findings contained within.

I could write on about the timeliness of internal audits, but that wouldn’t be a good use of our time. I hope some of my ideas are helpful as you ponder the future of your audit processes.

As always, I look forward to your thoughts.

Share

Related posts

January 31, 2023

Recent Advice on Hiring Internal Auditor’s You Can ‘Trust’ Is Misdirected


Read more
January 24, 2023

Do Performance Bonuses Impair Internal Auditors’ Independence and Objectivity?


Read more
January 16, 2023

Are Internal Auditors to Blame When Boards Are in the Dark?


Read more

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

What’s Trending

01-31-23

Recent Advice on Hiring Internal Auditor’s You Can ‘Trust’ Is Misdirected


01-24-23

Do Performance Bonuses Impair Internal Auditors’ Independence and Objectivity?


01-16-23

Are Internal Auditors to Blame When Boards Are in the Dark?


Read More

Archive

  • January 2023
  • December 2022
  • November 2022
  • October 2022
  • September 2022
  • August 2022
  • July 2022
  • June 2022
  • May 2022
  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • November 2021
  • October 2021
  • September 2021
  • August 2021
  • July 2021
  • June 2021
  • May 2021
  • April 2021
  • March 2021
  • February 2021
  • January 2021
  • December 2020
  • November 2020
  • October 2020
  • September 2020
  • August 2020
  • July 2020
  • June 2020
  • May 2020
  • April 2020
  • March 2020
  • February 2020
  • January 2020
  • December 2019
  • November 2019
  • October 2019
  • September 2019
  • August 2019
  • July 2019
  • June 2019
  • May 2019
  • April 2019
  • March 2019
  • February 2019
  • January 2019
  • December 2018
  • November 2018
  • October 2018
  • September 2018
  • August 2018
  • July 2018
  • June 2018
  • May 2018
  • April 2018
  • March 2018
  • February 2018
  • January 2018
  • December 2017
  • November 2017
  • October 2017
  • September 2017
  • August 2017
  • July 2017
  • June 2017
  • May 2017
  • April 2017
  • March 2017
  • February 2017
  • January 2017
  • December 2016
  • November 2016
  • October 2016
  • September 2016
  • August 2016
  • July 2016
  • June 2016
  • May 2016
  • April 2016
  • March 2016
  • February 2016
  • January 2016
  • December 2015
  • November 2015
  • October 2015
  • September 2015
  • August 2015
  • July 2015
  • June 2015
  • May 2015
  • April 2015
  • March 2015
  • February 2015
  • January 2015
  • December 2014
  • November 2014
  • October 2014
  • September 2014
  • August 2014
  • July 2014
  • June 2014
  • May 2014
  • April 2014
  • March 2014
  • February 2014
  • January 2014
  • December 2013
  • November 2013
  • October 2013
  • September 2013
  • August 2013
  • July 2013
  • June 2013
  • May 2013
  • April 2013
  • March 2013
  • February 2013
  • January 2013
  • December 2012
  • November 2012
  • October 2012
  • September 2012
  • August 2012
  • July 2012
  • June 2012
  • May 2012
  • April 2012
  • March 2012
  • February 2012
  • January 2012
  • December 2011
  • November 2011
  • October 2011
  • September 2011
  • August 2011
  • July 2011
  • June 2011
  • May 2011
  • April 2011
  • March 2011
  • February 2011
  • January 2011
  • December 2010
  • October 2010
  • September 2010
  • August 2010
  • July 2010
  • June 2010
  • May 2010
  • April 2010
  • March 2010
  • February 2010
  • January 2010
  • December 2009
  • November 2009
  • October 2009
  • September 2009
  • August 2009
  • July 2009
  • June 2009
  • May 2009
  • April 2009
  • March 2009
  • February 2009

Contact Us

PO Box 1441
New Smyrna Beach, FL 32170

+1-407-463-9389
rchambers@richardchambers.com

About AuditBeacon.com

AuditBeacon.com is a resource center for internal auditors and risk professionals from around the world. In addition to more than 500 blogs authored by Richard Chambers, the site includes links to news and insights on internal audit and other information that illuminates the value of this important profession. AuditBeacon.com is provided as a service by Richard F. Chambers and Associates, LLC.

Copyright © 2023 Richard F. Chambers & Associates. All Rights Reserved.
  • Home
  • Blog
  • Audit Trail Academy
  • Advisory Services
  • Books