Transcript IIA General PowerPoint Template

The Internal Audit Leader
of the Future
IIA Israel Conference,
Tel Aviv
2 February 2012
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Background to the Speaker
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Vice President, IA Centre of Excellence, Huawei
Senior Vice Chairman - Global IIA
Immediate Past President of the ECIIA (2010-2011)
Past President of the IIA UK and Ireland (2005-06)
Provided Capacity building in Internal Audit & PIFC since 1998
Worked in the UK, Estonia, Latvia. Lithuania, Poland, Hungary,
Czech Republic, Kenya, South Africa, Romania, Macedonia,
Croatia, Serbia, Kosovo and Turkey
• Now responsible for developing internal audit capacity in a
worldwide Chinese owned telecoms company
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Some real changes
The profession founded in 1941
With Europe at war -and
the rest of the world
not far off
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Some real changes…
The profession –
developing a new
look in the two
thousand and tens
And with Europe again
in crisis
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Some real changes…
From Clipboard
To Tablet
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What is the Future…
“If surveyed today on how well internal auditing is meeting
its needs and expectations, my audit committee/executive
management would probably rate their overall satisfaction…”
Audit Committee
Executive Mgt
Unacceptable
0.0%
0.4%
Poor
0.4%
1.9%
Acceptable
16.1%
25.9%
Good
57.6%
57.8%
Outstanding
25.9%
14.0%
Source: Emerging Trends and Leading Practices Spring 2011,
The Institute of Internal Auditors – Audit Executive Network
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What is the future
Surveys of Directors/Managers tell us:
• 74 percent believe internal audit needs improvement
• 96 percent believe this needs to be within the next 24 months
• Only 44 percent believe internal auditing helps achieve
business objectives
• Only 37 percent involve internal auditing in key business
decisions and strategy
• Only 32 percent believe internal audit attracts future leaders
and high potential talent from within the business
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What is the future…
The CBOK Study of Stakeholders in 2010 told us:
• Almost 50% of respondents believe that internal auditing does
not excel at developing talent for leadership positions
throughout the organisation
• With Directors this is 42%
• With Audit Committee Chairs it is 50%
• With CFOs it is 62%
• Almost a third do not believe that internal audit has a role to
play in strategic risk
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What is the future…
Our CAEs tell us:
We are doing well
The CEOs and Audit Committees say:
You need to do a lot better
Who is right?
It doesn’t matter – we have to be relevant
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The Future Leader
The Future Leader has to
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Be aware of his/her limitations
Have integrity
Be a trusted adviser to the Board
Work in Partnership with the Audit Committee
Have an executive presence
Be relevant
Understand the Business
Be an expert relationship manager
Comply with Professional Standards
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The Future Leader…
Is aware of their limitations
– We are not all Einstein and cannot
always know the right answer – accept
it and work with it
– If we do not know, then do not offer or
if you offer get the right person in to
do it.
– Internal Audit will not always have the
answer – be aware of this
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The Future Leader…
Has total integrity & courage
– Ensuring strict adherence to the
Business Code of Conduct and
the IIA Code of Ethics
– Encouraging integrity in others
through example
– Being totally honest in all
dealings
– Having strong moral principles
and living up to them
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Doing what is
RIGHT even
when it is
difficult
The Future Leader…
Is a trusted adviser to the
Board, through:
– Gaining the trust of the Board,
providing
• Detailed knowledge of the business
in their own right and by the Internal
Audit Unit
• Reporting that adds value to the
organisation, by providing solutions
• Non-partisan use of information
learnt at Board level
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The Future Leader…
Works in Partnership with the Audit Committee
The Audit Committee will be a strong supporter and/or a loud
critic
Do not just report to the Audit Committee, involve
them
• Have informal and formal meetings with the Chairman
• Provide briefings on the pertinent matters of the day
• Offer advice on actions that need to be taken
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The Future Leader…
Has Executive Presence
– Take command of the room
– Leverage your influence to
enable effective decisions
– Listen to others
– Inspire those around you to
peak performance
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The Future Leader…
Is Relevant
– Knows the business
– Makes reports at the
right time, the right place
and with the right
emphasis
– Makes the business want
Internal audit
– Listen to the Chairman’s
message on
AuditChannel.tv
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The Future Leader…
Understands the Business
Links to all the others
– Has a detailed knowledge of the business,
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how it works
What it is attempting to achieve
What the risks to the business are
Who is important and why
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The Future Leader…
Is a good Relationship Manager
– Identifies and understands the
needs and requirements of those
around them
– Listens carefully to what is said
– Understands the dynamics between
members of the Board and between
the managers within the
organisation
– Makes sure that managers/directors
own the solutions
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The Future Leader…
Ensures compliance with Professional Standards
– 90% of stakeholders indicate that adherence to the Standards increases
their confidence in internal audit
– More than 70% percent believe compliance with the Standards is a key
factor in the ability of IA to add value to the governance process
…Yet up to 60% of internal audit departments still
have not undergone an external quality assessment
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Conclusion
The Future Leader of Internal Audit will make certain
that internal audit
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Is Relevant
Is Business-like in its approach
Understands the business
Offers solutions
Works for the business
Is professional
In short, Internal Audit Adds Value
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Thank you
Phil Tarling
Office: +441256868974
Mobile: +447802656986
Email:
[email protected]
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