Are You Ready for the New Global Internal Audit Standards?

 With the Global Internal Audit Standards set to take effect on January 9, 2025, it is crucial that the audit committee is well-prepared and familiar with these standards. To assist with this, we have created a brief presentation designed to equip audit committee members with essential information.

Reach out to us to schedule an in-person or remote presentation.

“Is AI a Potential Existential Risk?”

 Many people recognize the advantages of AI in both professional and personal realms. However, it comes with several risks, such as some of the examples outlined below. While there is broad consensus on many of the risks, few are more contentious, such as the potential existential risk as discussed in the infographic below. I’ve been keeping up with expert discussions on this topic and am still trying to form an opinion on it. Time will tell whether it is a genuine concern or just undue worry.

What do you think?

When Internal Audit Is Agile And The Audit Committee Is Not!

The traditional challenge for Internal Audit was in its ability to meet and/or exceed its stakeholders' growing expectations. While some Internal Audit functions may have suffered and failed to achieve this objective,  I would like to believe that most of the functions have been successful not only in meeting the expectations but also in taking the lead and initiative to introduce change and innovation and prove their relevance!

One of the buzzwords and trends nowadays is "agile internal auditing". Internal Audit functions around the world are working on understanding what it is about, exploring what it means to their operations and how to successfully implement it in their organizations. A successful implementation requires the buy-in and collaboration of stakeholders. You would think that management and the audit committees would be thrilled when Internal Audit starts the transformation process. That would be true in most cases, but sometimes there are forces within the Organization that resist change. When these forces are management, Internal Audit can seek the support of the audit committee to convince management. But, what if the audit committee is the resisting force? Imagine a situation where a CAE approaches the audit committee with  his/her plans to implement agile internal auditing and the answer he/she gets is:

• "This is a luxury we can't afford",
• "Stick with the audit plan, it works", 
• "This is not the time for a dramatic change", 
• "We don't have the resources and/or experience to do this", 
• " We will think about it",
• "What is agile internal auditing?"

Does this sound familiar? If you have heard any of the above responses, you are not alone! 

What comes to your mind when you hear such a response? You may conclude that Internal Audit did not do a good job communicating the concept and benefits of agile internal auditing to the audit committee. Perhaps they did not explain that it is more of a  mindset than a methodology, that it can be applied gradually, that it is not all or nothing approach or a one approach fits all solution. The reaction of the audit committee could indicate that there is a deeper disconnect with the audit committee! You may also conclude that the audit committee members don't possess the right mindset, vision, experience, or qualification to discharge their duties in these uncertain times! 

What will be your strategy to bridge the gap with the audit committee and initiate the transformation to agile internal auditing.? Please share your experience and thoughts. And remember to:

                                                               "be agile, be alive"!

Adapgility Consulting is your Internal Audit Partner and can help with the agility transformation process.

Picture source:www.hme-business.com

Are you the same person you were before the COVID-19 crisis?

Now that you have stayed at home and working remotely for some weeks, it may be time to ask how this life-changing experience has affected you at the personal and professional levels?

Are you the same person you were before the crisis?

What has changed in your perspective of life, family, and your profession?

When you return to your office, hopefully in the near future, what would you be doing differently? Will you be doing audit planning, risk assessment the same way you used to do? How will your relationships with the stakeholders be reshaped? And more importantly, how your understanding of your role as an internal auditor has changed or evolved?

If you believe this experience has not changed you, can you share why you feel this way and what contributed to your status quo?

Please share your thoughts!

picture credit:https://liveboldandbloom.com

How will Internal Audit look like after COVID-19?

There have been many articles and posts dealing with the Internal Audit's role during the COVID-19 crisis. These were useful, but now we need to plan for what happens next. The economic, social and financial implications of the crises are expected to be severe at least for the short term.

Eventually, this crisis will pass and most businesses will resume operations and will have to adapt to the new realities to survive. Changes to operations and mindset will need to be made at all levels including at Internal Audit Departments.

As most of you are at home during this difficult time and are probably bored, let's try to think about how the internal audit function at your organization will look like after the crises! For example:

• Did the crisis change you as a person and how this will reflect on you as an internal auditor?
• What lessons have you learned during the crises and what are you going to do about it?
• What type of changes will you make to strengthen internal audit?
• Do you anticipate an increase or decrease in the number of auditors within your department?
• Do you anticipate management to change its perspective of internal audit (positive or negative)?
• What would you do to be prepared for the next crisis?

I look forward to hearing your thoughts and feedback!

Should The IIA & ISACA merge?

In a joint IIA and ISACA press release back in 2010, the following statement was included to explain why the management of both organizations have met to discuss shared challenges and opportunities:

"Given the similar—but not same—nature of ISACA’s and The IIA’s professional areas, it is not surprising that the organizations have faced many of the same situations over the past several years." 

A decade later and while we acknowledge that there is a reasonable level of coordination between both organizations, one can not stop wondering if there is a need for both organizations to merge to better serve their members and customers!

Should the rapid change in professional roles, technology, disruption, risks and stakeholders' expectations justify a merger? There were indications throughout various surveys that CAE's are now more involved in the management of IT audits and that this trend is expected to continue in the future. Is this enough reason to start thinking about a merger?

I have raised the merger issue in several posts in the past but did not receive enough feedback! I hope we can now start a debate on this issue. I would love to hear the views of those who support and oppose such a merger!

These are my thoughts, please share yours.

 

The Internal Auditor- A Short Novella

I Like to read and I enjoy fiction books! I have read hundreds of them over the years. I am a fan of John Grisham and I have enjoyed his earlier books such as The Firm, The Client, The Partner, and others. I have also enjoyed the writings of other authors especially those who have created interesting characters such as Lee Child's Jack Reacher and Vince Flynn's Mitch Rapp. These characters were from many professional backgrounds such as Lawyers, Law enforcement, Military, Medical professionals and almost every other profession except for internal audit! I decided to take the initiative and change that!

My passion for the profession coupled with my passion for reading ,and occasionally writing, inspired me to write the first novella depicting a Chief Audit Executive as the main character! I have faced challenges in writing the novella, first of which was the fact I am not a professional writer and that I have never written a book before. The second challenge was that English is a second language to me which may have limited my ability to convey my thoughts and messages as intended! Nevertheless, these challenges did not stop me from writing and self publishing the book. I recognize  that the novella is far from perfect, but it is a start!


The title of the book is " The Internal Auditor". You can read an excerpt here. 

If you are interested in buying the book, it is offered at a nominal price at Amazon  or you can read it for free if you are a kindle subscriber. Alternatively,  you can buy it directly from my website www.bibiconsulting.net

The story was also converted into a training session to edutain internal auditors. The idea is to entertain them while we educate them. It includes reading the story as a prerequisite. During the session, we discuss the lessons learned from it and what could the CAE have done differently. The training is available on demand.

I am writing my second Novella " The Retirement " and hope to publish it soon!

The Proposed Internal Audit Code of Practice: A Necessity or A Duplication?

The Chartered Institute of Internal Auditors has published for consultation a draft of a proposed Internal Audit Code of Practice. According to the Institute, the 30 recommendations included in the draft are aimed at enhancing the overall effectiveness of internal audit, and its impact, in the UK and Ireland. The recommendations can be regarded as a benchmark of good practice against which organizations can assess their internal audit function.
The Institute emphasized that the code should be applied in conjunction with the existing International Professional Practices Framework (IPPF). It continued to mention that the code builds on the IIA standards and seeks to clarify expectations and requirements needed to strengthen the effectiveness and impact of internal audit.

The 30 principle-based recommendations cover the following areas:
·  Role and mandate of internal audit
· Scope and priorities of internal audit
· Reporting results
· Interaction with risk management, compliance and finance
·  Independence and authority of internal audit
· Resources
 The recommendations range from identifying the primary role of internal audit to calling for the internal audit to have sufficient and timely access to key management information and right of access to all of the organization’s records.
The code which is described as “voluntary” is written in the context of a reasonably sized organization operating in all private sector organizations within the UK and Ireland. Modifications may be needed to accommodate the size, scope, risk profile and complexity of operations of various organizations.

 After reading the recommendations, do you think they:

1.        Duplicate  the IIA standards and add little value
2.       Complement the IIA standards
3.        Add significant value to the IIA standards .

 Also, do you think other countries should adopt similar code through the  IIA chapters?

 Please share your thoughts.

  

The Future of Management Consulting

I am facilitating a discussion through Convetit on the future of management consulting. A diversified panel of experts from around the world are providing their valuable insight and thoughts.

The first theme of the discussions covered " How management Consulting is Evolving in Response to Technological Advancement& Disruption?" .The conclusion was that:The rise of small & Agile independent consultants with focused specialization is a trend to continue in the future: - Small & Agile Consultants is the trend- Focused: strict specialization on the rise- The big  Consulting firms will stay big! 

The second theme covered "Attributes of the Future Management Consultant". The panel concluded that:A Future Value - Adding Trusted Management Consultant is One With Empathy, Courage, Real Life Industry Experience and High Communication Skills!- Empathy Came As A Top Attribute!- Real Life Industry Experience is a Must!- Be Courageous!- Communication, Communication, Communication! 

We have started the third theme which is currently discussing what would management consultants do differently from now on to ensure they remain relevant.Please join the discussion and share your thoughts!

Internal Audit is not A Desk Job, Keep Moving!

In today's IIA webinar "An Outlook of the Internal Audit Landscape for the Year Ahead ", the following slide was presented:

While all the above mentioned resolutions are important, the one relating to " Build Deeper Relationships" is , in my opinion, of extra importance and could be the most difficult .

Yesterday, a report in Canadian television stations discussed the negative health effects of desk jobs and suggested that employees should move and stand while doing their jobs! I am calling on internal auditors to keep moving ,not only for health reasons ,but for the health of their relationships.

Building deeper relationships can't be achieved through emails, memos and telephone calls alone,it requires  personal interaction and face to face meetings. I fully understand the time constraints ,but make sure your audit plan includes time for personal interactions and treat it as an investment in the achievement of the internal audit objectives.

A successful CAE is that who makes it his  mission to meet with his "customers" at every possible opportunity.This does not have to be an official meeting at all times ,but the types of " watercooler talks",  I am not referring to gossip here, but to small talks that help build professional relationships . This is not limited to the CAE ,but applies to all levels of auditors who should attempt to do as much work at the "customers" offices as possible and practical.

Those who follow my writings have probably heard about my 4 P's in conducting audits:

Professionalism
Patience
Persistence
Personalization

Personalization refers to the fact that people are different and internal auditors need to develop a personalized plan to approach and deal with them. During my long audit career ( external and internal) ,I used to invest few minutes collecting information about the people I plan to meet with to discuss planned audits. I looked for what their interests are and I used it as an opining to our meetings and an ice breaker. The first thing I do when I enter an office is to scan its contents for family pictures and other contents that may indicate a hobby or an interest area. Even the most difficult "customer" would love to talk about his/her kids!
This approach never failed me in the 35+ years of my professional career .You need to be careful though not to engage in controversial subjects such as politics and religion!

You can't get to know people's expectations without knowing them (the people) first!

Your new year resolution theme should be " leave your office and mingle with your customers!

These are my thoughts ,please share yours!

Are you an Internal Auditor at home as well?

Is your career, as an internal auditor, affecting your lifestyle and relationship with others?

It is a fact that our careers affect our lifestyle in one way or another, whether we intend this or not.For example, as an internal auditor, do you find yourself :

- Dealing with others with skepticism without giving them the benefit of the doubt?
- Paying too much attention to details at home? This may not keep your spouse or other family members happy!
- Trying to maintain independence in your relationships with family members and friends when sometimes you have to take sides and be biased?
- Questioning if your actions may result in a conflict of interest all the time?

On the positive side,do you think that internal audit made you :

- A more effective communicator
- An objective person
- A persuader
- Add value and change lives around you
- Vigilant. You pay more attention to your surroundings
- Better understand risks and opportunities
- Improved your decision-making process

Please share your thoughts and experience.