May is Internal Audit Month
MEDINA, OH (May 1, 2019) – May is Internal Audit Awareness Month. During this observance and throughout the year, audit professionals work to raise awareness of the internal audit profession and its value to businesses and organizations.
The awareness efforts are not only to dispel misperceptions of the profession but also to enhance everyone’s knowledge of the essential role internal auditing plays in strong organizational governance, internal control and effective risk management.
Richard Chambers, an internationally recognized leader in the audit profession and past president of the Institute of Internal Auditors, has described various misperceptions about internal auditors and provided information to debunk these myths about internal audit awareness month:
- Internal auditors are accountants by training
One of the most common misperceptions about internal auditing is that the auditors are all “bean counters” who focus solely on their companies’ financial records. There is an obvious grain of truth in this internal audit myth. A solid audit or accounting background can be helpful for a career in internal audit, but internal auditors commonly address fraud risks, compliance issues and a myriad of operational issues that are unrelated to accounting. The auditors’ backgrounds are likely to be as diverse as the operations they audit.
- Auditors are nitpickers and fault-finders
According to this myth, auditors are viewed as the group who “bayonets the wounded after the battle is over,” distracting management from more important responsibilities.
In reality, of course, internal audit’s focus is on major risks rather than on nitpicking details. Audit resources are limited, and when auditors focus too much attention on minor issues, they are limiting the time available for addressing the major risks and controls that are at the heart of internal audit.
- It’s best not to tell the auditors anything unless they specifically ask
Audit clients are sometimes given this advice by well-meaning friends, but it results in less efficient audits and wastes everyone’s time. If auditors believe their clients are purposefully hiding information, whether by omission or commission, they normally will increase the scope of the audit to determine whether other important information has gone unreported. The purpose of internal auditing is to add value and improve an organization’s operations, and hiding information is against everyone’s best interests.
- Internal auditors follow a cycle in selecting their audit “targets” and use standard checklists so they can audit the same things the same way each time
This myth is less true with each passing year. Professional standards require risk-based plans to determine priorities, both in developing audit plans and schedules and in planning individual audits. But in general, internal auditing has become a dynamic profession that can change any time an organization’s risks change.
- Internal audit is the corporate “police function”
The best auditors are usually those who create a rapport with audit customers. When an auditor’s behavior is accusing or aggressive, they are far more likely to be met with resistance than when they treat findings as an opportunity to help accomplish objectives and facilitate improvement. Breaking down this stereotype is so important that most internal audit groups actively encourage clients to think of internal audit as a coach, not a cop.
Learn more about Vestige’s Internal Audit Services.
Also, look for the Vestige Exhibit at the annual ACUA AuditCon, Sept. 15-19, 2019 at the Baltimore Marriott Waterfront, Baltimore, MD.