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Mind of Jacka: Reflection Can Happen Any Time

Blogs Mike Jacka, CIA, CPA, CPCU, CLU Jan 25, 2024

Here it is, late January, and I’m still seeing posts discussing lessons from last year. I’m guessing everyone is getting a little tired of seeing articles like “2023: The Audit Year in Review,” “12 Darned Important Lessons from Last Year’s Audit Work,” or “The 10 Biggest Internal Audit Disasters.” (Note: I Googled that last one and, luckily, it doesn’t exist. But there were sure a few that came close.)

I shy away from most of these end-of-the-year posts. Don’t get me wrong — they serve an important purpose. Those who don’t learn from the past, etc., etc., etc. (A lesson we should all be taking to heart.) But, in general, there is more nostalgia than transformation in such writings.

And I’ll bet you have been similarly inundated with shape-of-things-to-come articles discussing 2024. Titles like “Top Risks Every Internal Auditor Should Have on Their Schedule,” “You’ll Never Get to Sleep When We Tell You About These Exposures in 2024,” and “What the Discriminating Internal Auditor Will be Wearing in 2024.” (And, no, I didn’t Google that last one. Far too afraid of what I might find.)

Yes, there is value in being prepared for the coming year, but I don’t put too much weight on these forecasts. (Find me an article from 2019 predicting the risk of an epidemic in the coming year, I dare you.) And don’t even get me started about New Year’s resolutions, or the business counterpart, “How we will make our departments better this year!” They are generally promises made with no practical thought on how they will be accomplished. Consider initiatives your department developed in the past. And then consider how many of them experienced quick and merciful deaths under the weight of needing to get real work done.

That doesn’t mean I don’t get reflective at the end of the year, nor does it mean I don’t think about what I might do better. Shoot, I’ve not only got a list of the projects I want to get done in the coming year, but many are carried forward from last year, and just as many have already been scratched off under the heading “Better Luck Next Time.” I really don’t spend a lot of time with the past or someone else’s interpretations of the future.

Given the preceding, you might find it surprising that I recently found myself reading an article from The Brain Food Newsletter titled “Annual Reflection.” It is an article about reflecting on the coming year and would have been quickly cast in my virtual wastebin, but I decided to dig in based on my faith in this source.

Glad I kept it. Glad I read it. I found this to be a different approach to the subject. Although it is written for the individual, it has even more power when the associated questions are asked of a department.

Here’s a link to the newsletter Consistently Boring ( where you can look up the article. And you should look it up and read it because, just as I did, you will find different ways to analyze and positively change your department.

To give you a taste, here’s a few of the concepts, as well as my interpretation of how they might apply to an internal audit department.

Eliminate Ruthlessly

Let’s start with the fact — and I’ll go out on a limb and state that it is, indeed, a fact — that there are parts of your process that make absolutely no sense: legacies no one thought of challenging, redundancies that have been kept “just in case,” and steps that seemed like a good idea at the time. Look at how you are doing your work — look at it as coldly as you would a client’s processes — and get rid of the useless.

Further, look at the actual work your processes are supporting. Why is it being done? Should internal audit be the one doing that work?

For example, many times in my career we attempted to take a good, long, and hard look at the work we were doing at Farmers Insurance Internal Audit. We would start with a clean slate — nothing was sacrosanct — and the first thing we would do with that clean slate was put back the work we did at the individual agent level. These represented 30% to 40% of our schedule and were ripe for change, but we had always done them. We couldn’t imagine not doing them. Finally, about 25 years into my time at Farmers, we removed them from our workload and put them in marketing where they belonged.

Eliminate ruthlessly and with as little respect for the past as necessary.

You’re Fired

For some, the existence of internal audit is closer to John Lennon (“imagine there’s no internal audit department; it’s easy if you try”) than Rick Astley (“Never Gonna Give You Up,” and, yes, I guess this post has now been officially Rickrolled). But few realize it. Many live complacently oblivious to the fact that any audit department anywhere can be fired at any time. Any audit department. We need to act as if the Sword of Damocles constantly hangs over our futures.

Your first response should be to ensure you don’t get fired. Know where your department’s value lies. Know how to sell that value. And vigilantly look for ways to make it better (see above). Make your department so valuable that “they” can’t live without you.

Also look at it another way. Understand why you might get fired. What if your entire department was let go and the CEO brought in a new department? What would that department have that you don’t? What would it do differently? How would it be better? Then make your department the one that would be hired to replace you.

You’re More Successful Than You Think

Note that this isn’t on the “Annual Reflection” list; rather, it is my interpretation of one of the items. Which one? Well, you’re just going to have to read the article, aren’t you?

We spent a significant amount of time at Farmers Insurance making our internal audit department the best it could be. As a result, we became quite self-critical. In trying to bring the department to a fine polish, all we could see were the burrs and blemishes that remained. I’d say that, if we had taken a poll, we would have rated ourselves in the middle of the road — maybe upper middle — for internal audit departments.

When we entered the real world, we started attending conferences, seminars, and lunches, and we learned something amazing. We were at the forefront of a lot of things going on in internal audit and were miles away from what a lot of internal audit departments were doing.

We were one of the best audit shops out there. Yes, we still had a lot to do — those burrs and blemishes — and it was important that we not rest on any recently discovered laurels. But, dang it, we were doing pretty well.

There’s a good chance that, if your department is doing any serious critical analysis of the work it is doing, it feels like it has a long way to go. And you may be right. But take time to step back. You may be better than you think you are.

That’s a few of the topics you’ll see in the “Annual Reflection” article. Take some time and read the piece. (A short amount of time; it’s a short piece.) I think you’ll find some interesting ideas on how to make your department better. And, yeah, it’s already late January, later than such a task is usually taken on. But it could be that taking on that task now — after the shiny promise of a new year has lost its sparkle — might allow for some practical reflection.

Using this article’s approach may mean you come up with something that can really work, not just fall by the wayside like your promises to work out, shed a few pounds, and read more internal audit blogs.

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.