I admit it.
This post is inspired by a post with a similar name by my good friend and occasional debate partner, Richard Chambers: 10 Red Flags Your Internal Audit Function May Be Losing Ground.
Have a look if you haven’t already read it. He makes some very good points.
Here are his ten red flags:
- Static Audit Plans
- Stakeholder-Led Risk Identification
- Comparisons to Peers
- Overdue Quality Assessments
- Unilateral Budget Cuts
- Marginalized in the Boardroom
- Assurance Sourced Elsewhere
- Succession Overlooked
- Controlled Access to the Audit Committee
- Existence Questioned
These are all good, although his #4 would not bother me very much.
I’m not going to debate these ten. Richard explains each of them well.
Instead, I will share my six red flags that your internal audit function is in trouble. I am sure there are more, and I ask you to mention them in your comments.
- You find out that management is looking to hire somebody for your job. Even worse, this is with the blessing of the audit committee of the board.
This actually happened to me. I was having serious issues with the CFO, and he was having similar issues with me. We didn’t like each other, and that was in addition to disagreeing whether the company had serious issues. I thought it did (and was right: it wasn’t long before the company failed), and he…
