Skip to Content

​Mind of Jacka: Oh Yeah, Employees Are Important, Too

Blogs Mike Jacka, CIA, CPA, CPCU, CLU Feb 23, 2021

Do you ever find yourself reading something — a bit of learning, an illuminative piece, a collection of evidential tidbits, an analysis of juicy data, something from which you are gratefully gaining knowledge and insights — when you stumble across a factoid, an enlightenment, a piece of information that brings you to a full stop, causes you to reread to ensure the initial reading was correct, and sends you into a tirade, a paroxysm of epithets, a maelstrom of spittle, a frenzied St. Vitus' Dance of angered hysteria, a veritable fit of pique?

Such happened to me the other day.

I was doing additional research for a presentation on internal audit resilience that I will be giving at The IIA's GAM Conference this year. (Note: It's not too late. You can still sign up for what is always one of The IIA's top conferences.) I was calmly reading Forbes online when I came across an article from Deloitte titled "Building Resilience: The Importance of Audit During Times of Disruption."

t's a nice piece. It has good information on the "value that C-suite, finance, and audit committee executives, investors, shareholders, and board members place on audit as a result of COVID-19." It showed their concerns and their perspectives on audit.

Again, nice stuff.

I'm sure I'm like most readers in that I tend to focus on the headline information — the categories that garner the highest numbers. In this instance I was reviewing the respondents' primary concerns related to the challenge of COVID-19. Then I looked more closely at the illustration included with the article, focusing on the lesser concerns.

And it was at this point that the fires began to burn, the storm clouds began to build, and the internal alarms went off warning that something was amiss in this wonderful world of ours. There were eight "concerns" listed. No. 6, in a section titled "additional concerns," was "health and well-being of employees." Behind concerns about the business model, accounting and financial reporting, financial resilience, customers, and brand, were the lowly employees, just beating out the supply chain and investor relations.

Just to nonrandomly pick one of those greater concerns, financial reporting was more important than the health and well-being of employees. In the middle of a pandemic that has infected more than 28 million and has killed half a million in the U.S., these executives thought financial reporting — financial reporting, financial …reporting, financial insert-your-favorite-expletive reporting — was a greater concern than the people who actually put those reports together, impact the results of that report, and are how the organization actually continues to exist.

Here's a number: 44% of respondents felt health and well-being of employees was a concern. In other words, over half did not feel that their employees — their employee's health, their employee's well-being, their employee's impact — was a top concern of the organization.

I hope the elevated level of my upsetedness has been appropriately displayed in the above. If not, let me finish by saying that this is heartless, short-sighted, and the reason so many employees say they are not invested in their work or in their organizations.

A fit of pique, indeed.

So, what does this mean for the internal auditor? Well, as often happens with such information, there are two aspects.

First, as always, auditor audit thyself. Where is the health and welfare of the audit staff on your list of priorities? If there are rumblings of employees coming back to the office, is every step possible being taken to ensure the auditors' safety? And, in general, where does the staff stand when it comes to internal audit's strategy? Are they prominently described as part of the success, or are they an afterthought — a line in the strategy that feels tacked on to appease the human resources department?

Spend some time examining the mote in your own eye. Talk to employees, review the strategic directions, and make sure that employees feel they are recognized as an important part of the department's success.

Second. Well, let me just say I feel an audit coming on. Maybe it's an audit of culture, maybe it's a strategy-level audit, or maybe it is just an audit of executives' perceptions. (Has there ever been such an audit? I don't know. Why not be the first?)

If you are working in an organization that places employees below the business model, customer relations, and the rassen frassen accounting and financial reporting, then it is internal audit's job to step forward and provide warnings that such actions are the road that leads to ruin. Do executives even know this is the perception? Does the board? Does the audit committee? Misaligned priorities may exist and no one really recognizes it. (How many of the 56% who didn't see employees as a concern recognized the disparity?)

Internal audit's job is to help an organization achieve its objectives. And those objectives cannot be reached successfully, at least they cannot be sustained successfully, unless value is placed on the employees. So, if employees are the "oh, yeah, and them, too" that pops up in strategies and plans, then raise the issue.

And what if no one wants to hear the message? Then you know everything you need to know about the organization's perception of its employees, the organization's perceptions of internal audit, and the reasons why finding a better operation for which to work is sometimes the best career move.

Mike Jacka, CIA, CPA, CPCU, CLU

Mike Jacka is co-founder and chief creative pilot of Flying Pig Audit, Consulting, and Training Services (FPACTS), based in Phoenix.