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Building a Better Auditor: The Right Hand of Management

Blogs Larry Kowlessar, CRMA May 09, 2023

May is Internal Audit Awareness Month. It is a time when institutes, chapters, and audit departments set up and participate in webinars, training sessions, panel discussions, and interviews to enhance awareness of a function that has become more critical than ever.

If organizations want to be serious about elevating standards, protecting their reputations, and maintaining credibility and stature, internal audit must be equipped with the necessary tools and resources to manage the ever-present scourge of risks. Risk is everybody’s business, and because internal audit is designed to improve an organization’s operations, management must support this function to achieve its goals.

We cannot sweep risks “under the carpet” like many do, which inevitably leads to missteps, errors, bad management, and poor decision-making. Risks will flare up from under the carpet like the fury of a stifled fire. Risks can force a change of plans, even causing operations to be halted while managers deal with them before corporate life can return to normal. In fact, the impact of certain risks can be catastrophic, much like COVID-19 was for so many, but if managed well, the likelihood of such risks should not reach the point of impact. This is where an objective and independent internal audit can be so valuable.

Internal audit, the organization’s board, executive management, and external audit comprise the four pillars of effective corporate governance. Good governance cannot be achieved without all four, underscoring the fact that internal audit should be heavily relied upon for effective decision-making. It is high time that internal audit is embraced for its assurance and consultancy functions, rather than be stifled in the background.

In some organizations, internal audit is considered a hindrance rather than a trusted advisor. In such organizations, management needs to reconsider its approach and remember that internal audit is set up to be its right hand. For their part, internal auditors must remember their ethical code and instill professionalism in every aspect of their delivery. For the partnership to be effective, internal auditors must win management’s appreciation.

During this month and continuing, the influence of internal audit must be felt not as “police” but as partners. This corporate governance cornerstone can assist with a broad range of engagement services designed to help organizations meet objectives. One of its roles is to monitor risks and ensure that the controls in place are adequate to mitigate those risks. 

Internal audit is trained to conduct objective assessments of operations and share ideas for best practices. Internal auditors also can provide counsel for improving controls, processes and procedures, performance, and risk management, while suggesting ways to reduce costs, enhance revenues, and improve profits.

If not already done, use this month to realize the true potential of management’s right hand, the internal audit activity.

Larry Kowlessar, CRMA

Larry Kowlessar is a senior internal auditor of the Urban Development Corporation of Trinidad and Tobago.