Have you ever had audit clients refer you to or suggest (sometime strongly) that you audit specific areas in the organization? What do you think about this? My thoughts have changed over time.
In the past, I believed that audit clients would provide referrals to “throw other units under the bus” or to get us away from their areas of responsibility. You know, getting rid of the auditor by focusing their attention elsewhere. As I have matured as an auditor, I have been forced to rethink this belief and have come to the conclusion that I may have been wrong. I believe that there are three reasons clients refer internal auditors to other units.
1. You do good work and other departments can benefit
I believe that when auditors help clients resolve control issues, these clients spread the word. If you think about it, auditors used effectively can be the organizations internal source of business consultants. Where else can functions receive objective, unbiased evaluations of their control environments. When you genuinely help audit clients, they spread the word.
2. They want to expose control weaknesses in other areas that effect them or the organization as a whole
Every organization has its issues. Oftentimes, the issues are known but for some reason, whether it be political, economical, social, etc, certain issues seem to never get resolved. I recall one audit engagement where we assisted an organization in realizing a $200,000 cost saving. While performing the engagement, the client mentioned some control weaknesses in other areas. They exposed these weaknesses because the services performed by the other unit significantly impacted their function. You see, they relied heavily on information from this unit. Information that was consistently late and occasionally inaccurate. Repeated attempts to correct the issue were unsuccessful. Realizing the true nature of our function, the referring unit believed that we could effect change. The internal auditors performed an engagement that led to an improved control environment as we served as mediators between the two feuding departments.
3. You did a good job, now leave me alone
I recall one audit year at an organization where the internal auditors cycled through almost all areas reporting to one Executive Vice President. There were significant issues that led to valuable improvements in the control environment. However, being audited is a grueling process and sometimes clients just need a break.
So, clients do not always refer auditors to other units to simply “get the out of their hair”.
What do you think?
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