Last month, Richard Chambers shared an outstanding article, Audit Committee Chairs Are Loud and Clear: Internal Audit Must Communicate Better. He said he would provide his own comments later on the major points made by the audit committee chairs he interviewed, but I would to add my own here.
His very first is that audit committee members want internal audit to be “An objective source of assurance on risk management and controls”. He adds as a second point that they need to be “Capable of connecting the dots and expressing overall opinions on the effectiveness of risk management and controls”.
This has been a hot issue for me for years. Richard will remember that I pronounced at a conference that “if internal auditors don’t assess and provide assurance on risk management, they deserve a seat at the children’s table”. His initial reaction was opposition, but then he switched and embraced and even repeated my point.
- Risk management helps leaders “pierce the fog of uncertainty” (Felix Kloman) about what lies ahead as they make decisions and endeavor to achieve enterprise objectives.
- Risk management helps them make the informed and intelligent decisions necessary for success after seeing the “big picture”, and balance downside risks and upside opportunities.
- When there are flaws in risk…
