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Overlooking the Obvious

Blogs Laura Soileau, CIA, CRMA, CPA Jan 24, 2019

Solutions by Soileau: In keeping watch for emerging risks, internal auditors shouldn't forget about the known risks facing their organizations.​

Overlooking the Obvious​

As I sat down today to write this blog post, I realized how long it has been since my last post. Sadly, I don't have some great reason for my lack of posts recently. Rather, my schedule became hectic toward the end of the year, and I spent much of my time over the last few months focusing on other issues. 

That said, 2019 is a new year and I'm happy to be back! However, I won't go so far as to make a resolution as to the frequency of my posts this year, as life events inevitably will come up that may impact my planned timelines.

I did have a moment of inspiration for my blog recently as I was traveling over the holidays. After spending a week out of town for some much-needed rest and relaxation, my family got ready to fly home. Of course, the holidays is one of the busiest times of the year to travel. Traveling by air can be doubly stressful — particularly this time of year — because of our lack of control of the many variables air travel often presents. 

However, for this particular flight, things seemed to be going relatively smoothly. Our flight was scheduled for an on-time departure, everyone boarded the plane timely, and we were all set for take-off. That is, until the co-captain came over the intercom and announced that we were going to be delayed because we didn't have a captain for the flight.

Of all the reasons that I've had flights delayed over the years — weather, mechanical issues, and catering issues to name a few — I must admit this was my first delay due to not having a captain. And while there are a lot of ways to make do with air travel, trying to fly without a captain — or sacrificing safety — is not one of them.

Of course, as I often am inclined to do, I thought about this situation from an internal audit perspective. Principally, how it can be easy to either be so caught up in routines (boarding passengers, ensuring catering is ready to go) that some of the most basic elements (having a captain) can be missed, or to be so focused on thinking through the unknowns that the most rudimentary of risks goes unnoticed.  Regardless of the cause, the result can have a significant impact on our organizations.

While the impact of a delayed flight is not nearly as critical as a safety or mechanical issue, the impact on customer satisfaction is still real. That is particularly true in today's environment when things can quickly go viral on social media and negatively affect an organization's reputation.

That said, I do not mean to imply that thinking about the unknown risks isn't important. On the contrary, thinking about unknown risks is critical for internal auditors. However, we can't be so focused on what we don't know that we overlook or become complacent to the known risks right in front of us.

For example, it is important to consider risks that will continue to emerge and evolve with the changing technology landscape. But internal auditors also must focus on the known risks that have been there all along such as those related to the control environment, tone at the top, and whether employees receive necessary training.

Going back to my travel example, the airline was able to adjust schedules for some of the other pilots who were in the vicinity, so our delay was less than one hour and we made it home safely. Further, for the airline, the delay was likely just one blip in a daily schedule of thousands of flights that it had to manage. However, when it comes to the risks encountered daily by our organizations, internal auditors might not always be so fortunate if we lose sight of the big picture and the risks we know to be there.

Laura Soileau, CIA, CRMA, CPA