Your stakeholders might not care about the exact number of internal audits performed last year. Few are likely to remember the number of professional qualifications held by their internal auditors or the average number of training hours they received. It might not even mater to them how hard you work. The most important question is simply: "Does the internal audit department add value?" Whether you publish publish five reports or 500 stakeholders are likely to perceive value only if the reports provide assurance on the effectiveness of internal control and risk management. They seek an internal audit function that fosters the efficiency and effectiveness of operation and preserves and enhances shareholder's value.
When viewed from outside the value we bring to the organization will always be more than the statistics. This doesn't mean that we should ignore statistics from internal audit performance. Such analysis can be important management tool, but our value is determined by the extent which we inspire positive change not by the number of pages we write.
We often add value by educating our clients and strengthening control awareness than by identifying a control breakdown. When we facilitate improvements in the control environment, we won't necessarily find as many things wrong in the future.
Even after appropriate criteria have been identified, the job is not complete. Whether our performance measures are quantitative the results should be carefully analyzed. Corrective action must be taken as appropriate and ongoing monitoring is necessary. Progress should be communicated on an ongoing basis to the audit committee, to executives and within the internal audit department.
internal audit departments that have clear objectives and are clearly aligned with their stakeholders' goals then to be much better respected. On average, these departments report to higher level and receive better funding, because they are seen as generating greater value and providing more value for money. The benefits are clear; internal audit functions that are respected and adequately funded can better bring about positive change. Whether you are an internal auditor or and internal audit stakeholder, that's an outcome we can all appreciate.
Food for Thought from the Internal Audit Department -NASSCORP
Courtesy of Paul F. Fallah, CFE