Are you tired of facing confusion and resistance from your auditees? Do you wish your Business Leaders had a better appreciation for the work auditors do within an organization? Learn how to proactively position Internal Audit as a value-add to every department in your organization by getting out in front of Business Leaders and advocating for your team. An Internal Audit roadshow can reframe audit’s reputation and start a dialogue about the benefits of internal audit assurance. And, when Business Leaders are better informed about what Internal Audit can do, better information can be obtained per project, and more unique and strategic audit opportunities can be identified. In this article, Tom O’Reilly breaks down four best practices for promoting Internal Audit in your organization.
As the internal audit industry continues to grow more risk-focused and risk-based, internal auditors must spread the scope of their work outside of traditional finance areas to other areas that are strategically important or that manage the biggest risks to the organization. In taking on these new, non-routine audits, Internal Audit is increasingly finding itself working with audit customers who have never been audited before.
Given a lack of experience with Internal Audit, new auditees may harbor misconceptions that can create confusion and friction during an audit. So, what can today’s audit leaders do to frame the Internal Audit function as a trusted advisor whose goal is to add value — not only to the larger organization, but to the new audit customer as well?
Forward-looking CAEs are getting out in front of the issue by holding roadshows, where Internal Audit takes the initiative to visit other departments or new managers to promote the importance of Governance, Risk, and Control, demystify the audit process, and highlight how independent assurance can add value to their responsibilities.
Whether you’ve been meeting with Business Executives to advocate for Internal Audit for years or it’s your first time, here are 4 best practices for putting on a successful roadshow that will reframe Internal Audit’s reputation.
1. Educate New Auditees about Internal Audit’s Role in the Organization
Many employees may not have much — if any — personal experience with the audit process, especially if audits are not routinely performed in their department. A core component of a roadshow is to proactively correct common misconceptions about audit by explaining how Internal Audit fits into the broader organization as a partner to the business. The following is an example of how you can introduce your department’s role:
The Internal Audit function helps provide independent perspective and assurance in areas of high risk and areas that are important to achieving the company’s goals and objectives. Internal Audit also helps create awareness around a strong environment of governance, risk, and control, which can further enhance the likelihood of organizational success.
Make sure to dispel the notion that the audit department dedicates time and resources to an audit in anticipation of finding fraud — rather, audit is taking action because the department, office, or area is vitally important to the success of the company, either through safeguarding or enhancing organizational assets. As most companies continue to staff and resource their departments “lean and mean,” chances for mistakes — or worse, fraud — can be overlooked. Thus, having Internal Audit independently evaluate process performance and transactions helps the organization identify issues that can result in wasted money, non-compliance with laws and regulations, or loss of revenues. Additionally, an independent audit function helps the Board of Directors carry out its oversight responsibilities.
2. Demystify the Audit Process and Audit Report
While auditors are very familiar with audit’s purpose and procedures, your audit customers may not be. Break down the audit process for your auditees to create helpful future expectations about communication and methodology. Perhaps you have a unique way of identifying what is important through your planning process. Walk your auditees through exactly what happens during fieldwork, and what you do to minimize disruption to their day to day work.
Don’t forget to stress the point that your team works to eliminate surprises! Audit reports can be a source of anxiety, so take some time to explain what goes into an audit report, how and where the audit report will be published, and who will read it. Let your auditees know that when conducting an audit, the aim of your department is to work with auditees in a spirit of customer service and continuous improvement. When an auditee grasps the audit process, they will be more likely to contribute to and collaborate during a future audit.
3. Highlight Audit Team Members and Past Successes
Especially for auditees who are unfamiliar with your organization’s Internal Audit team, provide context about who your auditors are, and give examples of previous value-add audits. If you have a rotational audit program, talk about how it brings expertise from other departments to make Internal Audit more business-savvy and process-savvy. If a team member has experience relevant to the department head you’re meeting with, be sure to highlight that person in your discussion.
You’ll also want to bring up relevant past successes. Your examples of past audit successes should illustrate how audit positively impacts business performance and is not just a cost center. Highlight how your department brings in external consultants who are subject matter experts to help assess how well processes are designed and to provide expert recommendations and best practices at the end of audits. Be sure to share that certain audit reports have actually justified less than perfect performance, and have also helped ensure appropriate funding is received to mitigate any identified issues. When your auditee knows who forms your audit team and appreciates the valuable work they’ve done across the organization, audits are more likely to start off on the right foot.
4. Keep the Focus on the Audit Customer
The previous steps have focused on Internal Audit, but your roadshow meeting doesn’t need to! You might spend 20% of your time breaking down misconceptions about what audit does and does not do, and the remaining 80% in a more active discussion about ways Internal Audit — with its valuable perspective across the organization — could help the future audit customer. To jump start this discussion, consider bringing the person you’re meeting with a concrete piece of information relevant to their role, department, or industry.
For example, highlighting relevant past troubles or failures of peer companies regarding emerging risk areas can help motivate a Business Leader to proactively act to mitigate any future issues. For a person new to the organization, this could be organization-specific information not covered during onboarding — key acronyms, product lines, strategies, and so on. Or, you could build on one of your examples of past Internal Audit successes to discuss ways a similar approach could be applied to help the auditee’s department. You might also invite the person to come speak to the audit team just like you’re speaking to them — this shows that they are important to you, and that audit wants to learn from other departments. Driving home how Internal Audit can add value to the audit customer will help reframe Internal Audit’s reputation and make future audits smoother and more productive for both auditor and auditee.
A roadshow can be a powerful tool to position Internal Audit as a partner to the business, especially in larger, more decentralized organizations with remote offices. A roadshow can be an opportunity to make introductions, correct misconceptions, and familiarize audit customers with the concept that Internal Audit strives to add value to the most strategically important parts of the business. When audit leaders take the time to start a dialogue with Business Leaders and future auditees, they’ll be building Internal Audit’s positive reputation within the organization and setting the stage for effective audits with better collaboration and more value added.