I’ve been to a number of benchmarking sessions recently with other audit executives — both in the travel industry and from other large public companies. I always get a lot out of these sessions. A different perspective, a different approach, and general discussions about emerging risk really help me to bring new ideas and different thoughts to my team for consideration. Although our workdays are busy, I try to encourage my management team to attend these sessions as well.
Hot topics at the moment seem to relate to International Financial Reporting Standards and convergence readiness, cloud computing, social media, off-shoring and outsourcing risks, and continuous auditing. Enterprise risk management also continues to be a hot topic — although most of the larger companies have processes in place to manage risk, with a high degree of variability of approach. Most companies in the benchmarking sessions I’ve joined have stopped discussing Sarbanes-Oxley — other than to lament the drag that Sarbanes-Oxley testing can have on the audit plan. Old topics — such as the proper reporting structure of the audit function — seem to have settled down for now as most large company audit functions report directly to the audit committee. Admittedly, this may still be a problem for smaller audit shops.
One topic that would be interesting to poll on would be the number of audit departments who have prepared a long-term strategic plan. Are strategic plans looking out five years to determine what type of talent will be needed in the future and have they given thought to whether Sarbanes-Oxley-trained auditors can pivot to cover operational auditing if these are where the real risks to the business lie? Will current auditors embrace the data analytic tools that allow them to identify unusual patterns and trends in huge data sets that may indicate control weaknesses that haven’t yet surfaced? Some of my peer group state that their next new hires will likely be those who have a deep understanding of the business, rather than auditing — hailing from internal groups such as information technology, engineering, operations, sales, supply chain, and human resources as well as complimentary industries. Others have adopted guest auditor or internal co-sourcing approaches to tap this internal talent on a project-by-project basis. This sounds like a great idea, so I thought I’d pass it along to you.
Here’s hoping you continue to network with your peers to evolve the value of internal auditing. If you have thoughts on any of these topics, please share.
Posted on Dec 6, 2010 by Kiko Harvey
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