Beyond Audit. Robert L. Mainardi

and how an audit works. Again, while this may seem like an easy task, the audit leadership team must ensure all auditors have the same knowledge of the audit function and deliver a consistent message to audit clients regarding audit's mission and the required steps necessary to complete an audit. This will guarantee that all audit clients are receiving the same message regarding the audit process and the need for business partner involvement throughout the audit to ensure its success.

While auditors need to acquire business process knowledge during the planning phase, they must recognize completing the task does not mean acquiring the same knowledge as the business processing personnel. Too many times, auditors in the planning phase exhaust the full planning budget diving too deep into the intimate details of a business process. Getting “buried in the weeds,” for a lack of a better phrase, usually means the audit team has gone too far into the business process minutia, which, in the end, will not increase the value of audit testing or the final report. During the planning phase, it is important to remain focused on the key business processes, which drive the achievement of the business deliverables (objectives). This is accomplished by reviewing the business developed policies and procedures, available flowcharts, and process walkthroughs with business personnel. The auditor should use every meeting and interaction with business team members to strengthen and foster the audit and business partner relationship. Auditors should spend more time with their business partners explaining the learning approach an audit requires and the corresponding reasons why it is so important. Let your business partners know how important the information sharing (and learning) is to an auditor during the planning phase as it sets the direction and focus of the upcoming audit. Additionally, all knowledge gained will be used in the development of the audit testing. With the proper business knowledge sharing, the audit planning documentation can be executed with minimal issues, questions, and business personnel disruption. Sufficiently detailed planning documentation will provide a solid foundation for the audit testing to be developed and executed, again, with minimal disruption to the client. This type of approach seems pretty standard. Meet with the client; gain an understanding; share information regarding the audit process; and learn as much as you can during planning. Appears to be pretty straightforward and simple. No – imagine trying to accomplish all of these things over the phone or video call without being able to sit down in the same room with the person and facilitate these critical discussions. I do not care how good a communicator you may be. Executing these discussions remotely poses significant barriers to success, not to mention an increased time commitment. If an initial planning meeting with a client to explain the audit process, introduce the team, and discuss the initial scope usually takes about an hour, consider doubling that budget at a minimum if you are doing it remotely. And I am going to assume, if this is a new client who has never been audited, the budget will be more than double. I am not suggesting the time commitment is not worth it. On the contrary, I believe it is not just worth it – it is mandatory. Do not skimp or rush through the audit department overview (or any other parts) during the introduction meeting with your client, because this meeting not only sets the tone for the current audit but is also the foundation for the audit and business partner relationship.

AUDIT FIELDWORK

After the planning phase comes the audit fieldwork. During this phase, the auditors must continue to work the audit and business partner relationship each time client documentation or data is requested, clarification of a business process step is required, or validation of a potential deviation from the business processing standard is noted. In each one of the previously listed incidences, the auditor is going to be required to communicate directly with the client to obtain the information or gain an explanation of an unknown. This creates the perfect opportunity for the auditor to build additional rapport with the business partner in an effort to gain trust to strengthen the bond between the two. Think about not only how critical these interactions are with the client but also how difficult these can be to execute when it is being done remotely. Being in audit over 30 years, I can attest to how challenging the fieldwork phase is, especially when additional information, data, or detailed explanations are needed to complete a test. Now complicate that need with the facts of the client not being readily accessible or the questions requiring answers are difficult. That is what remote auditors are facing on a daily basis. During these remote audits, auditors may not know if a client is available for questions or willing to answer the phone when it rings. And if the client does answer, will the client have the time to discuss and explain the challenges the auditor is facing, or will a new meeting have to be scheduled to address the issues? Everyone in business knows how difficult it is to schedule business meetings with representatives from multiple units. While this type of situation will not stop the audit from progressing, it will impact the timing of the audit testing and will result in the auditors having to reacquaint themselves with the test requirements. All of these situations affect the timing of the targeted audit completion.

      Also, remember to prepare for this impromptu follow-up meeting with the client, as the auditors must be ready with the exact topics, questions, and data which are to be discussed in this call. If the auditor is not adequately prepared for this call, I can guarantee you three things:

      1 The call will not sound professional.

      2 The audit client will not be happy with the interruption and lack of respect regarding effective use of their time.

      3 The auditor will not receive all of the information required to complete the testing and possibly forget an item, which will require another call.

      All three of these outcomes damage the audit and business partner relationship, and in established relationships create unnecessary erosion. It may not seem like a significant issue at the time, but the repeated calls or interruptions due to a lack of preparation on the auditor's part will create stress on the relationship, which impacts the audit team's ability to access critical information to complete the audit in a timely manner (close to the allotted budget) and establish a productive communication channel to facilitate issue validation, root cause, recommendations, and action plan discussion needed to deliver a value in the final audit report.

AUDIT REPORTING

The relationship building in the audit report phase could be considered the pinnacle of the audit and business partner relationship due to the impact of the interaction between the two groups during this final phase of the audit. Think about how much back-and-forth there can be when the draft report is being created. The audit status memo that was mentioned previously in this chapter, along with the benefits it has, not only in the development of the client relationship but also in the report generation process, can and will be relied on heavily to effectively support the final audit product. For the audit report to truly be value-added, it must include specific, tangible, and data-supported issues identified by audit and validated by business personnel. The process of acquiring the data and verifying the veracity of the included report issues relies on a productive and amicable relationship between the auditors and the business team. In this situation, the strength of the relationship drives a more efficient audit process and a collaborative effort to generate the draft audit report as well as the final product to be distributed to the executive team. With a strong relationship, the report generation discussion will be based on agreed-upon data and facts and not subjective opinions and perspectives.

      Over the past three decades of keynote addresses, conference workshops, and training events all over the world, I have always stated one undisputable fact about myself and my experience being an internal auditor: I was never the smartest or best auditor on the team, but I focused on building my business knowledge, observing successful audit and business personnel, executing assigned work to the best of my ability, and learning from my mistakes. In the end, however, I always credited my success of going from a staff auditor to a vice president of audit and facilitating training for over 30 years to my ability to communicate and build relationships both inside and outside of audit. Successful relationships will provide you with benefits ranging from learning from co-workers to successful partnerships with business unit personnel to add value. Use relationships to not only further your personal development, but also positively impact the effectiveness and efficiency of business processes you encounter throughout your career.