Mind of Jacka: What We Have Here is a Failure to Communicate

"If we treated the report as an ancillary product and something we could get by without, but need it for historical record purposes and 'documentation' only, as opposed to THE product, it would go a long way in shifting the mindset. "

There's a lot of good discussion that goes on after the post, and I would suggest you go in, take a look, join in, and become enlightened. But I want to home in on that later point — that the report is an ancillary product.

I have always taught/trained/pontificated/proselytized that the report writing process begins when the audit begins. My thesis has been that, by thinking about what needs to be in the report as we construct the audit, then the audit will have a better structure and the completion of the final report will go more smoothly.

Past experience has helped build this belief. Example #1: I was the specialist responsible for coordinating fraud investigations throughout our internal audit department. Auditors would call asking questions about how to best write sections of the report. To better understand what the auditor was trying to say, I would start asking questions. Eventually, I could feel the frustration on the other end of the line. I had quit asking questions about what the auditor was trying to say and had moved to the investigation process itself. Often, I'd find that the problem wasn't how to report what was discovered, it was the process that was used in the discovery. Bad investigations were leading to bad reports.

Example #2: To upskill everyone in report writing, internal audit leadership had a series of meetings to discuss reports that were being issued. All auditors were in attendance so that everyone would hear leadership's message on how reports should be written. Let's skip the point that some of us quickly realized that things would be said in one meeting and the complete opposite said in a later one. (Yeah, a problem, but not the one we're talking about here.)  After a few of these meetings I began to realize the situation was similar to what I experienced with fraud reports — it was impossible to write a good report based on bad audits. Bad audit work, bad audit skills, and a bad understanding of what was supposed to be accomplished resulted in reports that provided no value and made no sense.

That is the basis for my belief that the report needs to begin when we first start thinking about the audit. If we think about what has to be in the report, we do a better job of doing work that will support that report.

But now, Hal has made me question that approach. It is not that I don't think that, from the very beginning, we need to be cognizant of where we are going; it is that this approach may lead to the incorrect assumption that all the heavy lifting — the communication of details, assumptions, conclusions, and results of the audit work — should be done by the report.

I'm sorry, but one of the least important things we do — if we do our work correctly — is the audit report. It is merely affirmation of everything that has gone before.

That does not mean we should not be trained in the art of report writing. There is still the craft — spelling, grammar, tone — that we have to learn. And we have to understand the impact of the written word on what we thought were previously agreed-upon findings. (It is truly amazing how agreement can lead to disagreement when the agreements show up in black and white.) But if communication is successful throughout the audit — if we consistently talk and share and maintain an open transparency with the client — then those battles should be few and far between (minor skirmishes instead of World War III.)

And, you know what? Let's go back to that issue I swept under the rug in that second example —leadership providing contradictory advice on reporting. More than once, I've led a session on report writing and had someone come up and say, "I wish my boss had been here." Another problem in the area of writing reports is that those in charge don't really know what they want. To come full circle, that means they probably don't fully understand or engage in the communication that should exist with the clients.

Ultimately, I still stand by my thesis: The report process starts at the beginning of the audit. But that is only because it serves as an excellent framework for thinking. If you understand the foundations of the report, you understand the foundations of the audit work. But the belief that the role of reports is to be a primary (or even secondary) communication method is a fallacy and one of the things that keeps audit departments from being successful.

As I said, check out the discussion and join in. More importantly, look at what you are trying to accomplish with your reports. If it is the primary communication method, you may have a problem. And that means stepping up communication throughout the audit process.