Reputational Risk or Risks to Reputation?

My Reputational risk article is published.It can be viewed here:

http://bibiconsulting.homestead.com/riskarticle.html

Please let me know what you think.

IT Security and the Average Person

Last week, I was visiting a healthcare provider and was impressed with the software he was using to provide his services .I asked him when was the last time he backed up the data and patient files on his computer, I was shocked when he said "never". I asked him what will happen to his practice if his 3 year old laptop suddenly collapsed and the data can't be retrieved from the hard disk. He simply shock his head .I did not leave him that day until an external hard drive was bought and all his data were backed up.

This is only one example of too many cases that people face every day .How many of you can access unprotected Wi-Fi networks at home or work? How many of you know of people who do not have antivirus software installed on their computers? Or who do not use passwords to protect their computers of mobile phones?

This lack of basic IT security knowledge is not limited to the older generation of technology users, but can be seen at all age categories.

Spreading basic IT knowledge and awareness is an important step in living in a safer world. If every one of us can help those we know to reach a minimum level of IT security awareness, we will contribute to living in a world of less spam, identity theft and other risks.

I know that this takes time and effort, but it is worth it!

Do internal auditors need accounting designations?‎

Despite the important progress made in recognizing the value of the CIA designation and other internal audit-related certifications, I am still surprised that many companies (at least in Canada) are still requiring an accounting designation for their internal audit vacancies. The accounting designation is always “a must-have”, while the CIA is “a plus or nice to have”.

The question is: do internal auditors really need an accounting designation? The market seems to suggest that!! In my opinion, The CIA should be “a must-have” and the accounting designation “ a plus or nice to have”. What do you think?

Picture credit:https://bibf.com

Is it A Liquidity Trap?‎

I am not an economist or pretend to understand how the markets work. I am a simple person who invested in equities and mutual funds directly and through financial advisors and ended up losing a lot of money under both scenarios. I start my morning watching business programs on CNN, Bloomberg, CNBC and BNN to try to understand what’s going on in the financial markets .All what I hear these days is explanations  of why the financial markets are plummeting. There is no shortage of excuses!! I honestly do not understand why stock prices are falling when most companies are doing well and full of cash!

Today, I heard one of the commentators (I think on CNN) saying that we can blame what is happening on the “liquidity trap”! He said that individuals have money but not spending it because they want companies to hire people. On the other hand, companies have money, but won’t hire people unless they start buying their goods and services. He did not offer any solution on how to break this deadlock!

My solution is to switch off the TV and forget all about my investment for a couple of years!!

What is Wrong with Corporate Canada ?

With the news of problems facing RIM and its intention to cut 2,000 jobs worldwide ,due to declining sales, I am reminded that Canadian success stories may not be as successful as we think .Yesterday it was Nortel and today it is RIM, and who knows who it will be tomorrow ! What is happening in Corporate Canada? Is it merely the conditions of the markets that are leading to these results? or lack of leadership? My guess is that it is the latter! Look at the co –CEO structure at RIM as an example! Another RIM example would be its new Playbook that does not have G3 connection! It only connects to the internet through Wi-Fi! I did not expect this from a company that manufactures one of the best smart phones in the world!How would they be able to compete with Apple with a product like this?

The Murdoch's Scandal and Corporate Governance !

I am following with interest the Murdoch’s scandal to see how the lack of corporate governance ‎played a role in it, although it is obvious. This case will also help me finalize an article on reputational ‎risk that I am working on and will be published in the Federated Press’s Internal Audit Journal later this ‎coming fall.

Do Internal Auditors Add Value?

I have been following discussions on whether internal auditors add value to their organizations, and whether the “value-adding” factor is an objective of internal audit.

To start with, I believe we need a clear definition of the term “add value” when it comes to internal auditors. Does it mean saving money? Or providing a service that goes beyond the expected standard? Or something else?

I strongly agree with the argument that the main objective of the internal audit is to provide assurance. If internal auditors can add value while satisfactorily achieving this objective, it would be great. Any added value activities should not impair internal audit independence and objectivity.

My concern is that internal auditors may try to convince themselves that they are consultants first and auditors second. This is a dangerous path. Ask anyone from Arthur Andersen, myself included, and if they are honest   they will tell you that the beginning of the end of the firm started when partners and managers were converted to salesmen to sell consulting jobs!!

The Move from external to internal audit

I always receive e-mails from my linkedIn group(Internal Audit consultants) members asking for career advise .The last e-mail I received, a couple of days ago, was from a young member and it read as follows:

"I need your guidance at this stage as I started my career in external audit,and now I shifted to internal audit."

My response to him was as follows:

In my opinion, and based on my long experience in both external and internal audit ,the most important skill needed to be successful is people management skills. As you shift from external to internal audit, I hope you will benefit from your consulting mind set and treat your auditees as clients . I follow these 3 P’s:

Patience

Professionalism

Persistence

In fact ,recently I have added a fourth p : personalization .Each auditee is different and needs a personalized approach to deal with him/her.

What do you think of my response?

Reputational Risk: A Myth or a Fact?

I have just finished attending PRMIA‘s webinar relating to reputational risk and conflict of interests in banks and finance. This has reminded me of the debate on whether there is such thing as reputational risk? There are those who believe that it exists and can be identified and measured and others that believe that there is no such thing as reputational risk, but risks to reputation.

I will be writing a detailed article to simplify and explain the two schools of thoughts soon.