Wednesday, October 14, 2015

Should Internal Audit Forge Relationships with Regulators & Other Outsiders?

While updating my electronic internal audit library, I realized there are some documents that I have not read yet! One of these was a June 2015 white paper by Thomson Reuters entitled” A new order: The key skillsets necessary to thrive as Head of Internal Audit today”. The document lists skillsets that most of us are familiar with these days such as:

·         A thorough understanding of the (new) basic requirements

·         Critical thinking and the ability to continue learning

·         Deep industry experience and corporate knowledge

·         Leadership and ability to “belong” in the C-suite

·         A firm grasp of the importance of teamwork and partnering

·         And finally: The ability to view the organization with external holism

The last skillset caught my attention as I rarely come across anything similar to it in other literatures! The whitepaper explains this as:

“As regulators move beyond the strict letter of the law to point a finger at companies on issues involving culture, conduct and IT security, the burden on compliance and internal audit to anticipate appropriate standards and tests has become a constantly moving target”

It adds:

Consulting typically requires more creative thinking than assurance work, and this may involve the acquisition of new expertise, either by the internal auditor or through subcontracting.  It is important not only for compliance and legal, but for internal audit to forge relationships with regulators, subsidiaries, suppliers and major customers and to be able to anticipate changes affecting the business”

Do you agree with this? What type of relationships (objectives, scope and nature) with regulators, customers and suppliers are you willing to forge? How do you balance this with internal audit independence?

Do you agree with the statement that consulting requires more creative thinking?

Please share your thoughts and experience!

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