I want to thank David Finch, a board member who has also been the head of internal audit for a UK company, for his comments on a recent blog post of mine about audit reports.
He wrote:
As a NED, I have challenged CAE’s and executive management on the length of papers and reports issued to Audit Committees and Risk Committees.
Some provide the volume to demonstrate the work they have undertaken. Frankly I’m not interested in how hard they have worked – I’m interested in the control risks and governance implications within the topic under review.
Some believe they need to provide every last morsel of data, but forget that I need incisive information.
Some use volume as a way of passing the buck – “if you look at page 356 , paragraph 3, line 4, words 6-9”. One Finance Director got very upset when I said that I lost the will to live by page 350.
So why is it that executive directors (often with NED experience) don’t think likewise? Well Winston Churchill summed it up when he apologised for a long speech – he didn’t have enough time to make it short. And that could have been because he started in the wrong place to begin with.
As another board member wrote, reports (whether by management, the CRO, or the CAE) should be written with the customer in mind.
Write what the customer on the board…
