Top traits of an effective internal auditor

The President of the IIA shares what he sees as the top seven attributes of an effective internal auditor, and in general I agree, with a few distinctions.

The most important attribute is referred to as business acumen, but the description that accompanies it has more to do with having an in-depth knowledge of the business the auditor works for. Splitting hairs I guess, but acumen is the ability to make good decisions and exercise sound judgment. A strong understanding of what is driving the success of the business is important to cultivate, as is staying on top of developments within the industry in which it operates. I think both are important, but one is easier to develop than the other.

Communication skills come next, and I would broaden that to be people skills in general. The ability to read people and adapt to any given situation and personality is very helpful, so both the outward skills like communicating clearly and succinctly and the inward skills like listening actively and processing information quickly will come in handy when dealing with people within the organization.

Integrity comes in at 3rd, and is critical to establishing and maintaining your reputation as a professional. Being consistently honest and forthright in your interactions with your “customers” will allow you to build strong working relationships across the business.

Experience is next, and it’s not a subject I feel especially qualified to discuss, since I’m only in my third year as an internal auditor, sixth as an auditor. What I will say is that each day I strive to learn and get better at my job, and working with staff that have, among them, decades more experience than I provides a constant reminder of the value of that experience.

Number five on the list is a solid grasp of business risks, which to me means the exact same thing as the first item. Let’s just put them both together at the top and shorten the list to six, shall we? After that is talent development skills, which is important to have once you reach a certain level and have people reporting up to you. I could make the case that this is essentially a subset of people skills.

Last (but not least in my opinion) is courage and that’s important for auditors whether they’re external or internal. Part of the job is being the bearer of bad news and you’ve got have the stones to deliver it straight!


Experience requirement completion date nears

Earlier this month I received a letter from the governing body of my profession in this province, the ICAO. I wasn’t expecting it so naturally I was pretty curious. It turned out to be great news:

“According to our records, your estimated completion date of the 30-month practical experience requirement is 12/7/2007.”

ICAO envelopeEven before I had opened the letter I was treated to the new CA branding on the envelope. Not only that but the new CA logo is the only thing on the front of the envelope. The return address information is printed on the back flap at the opposite end of the envelope. Pretty cool twist for something as mundane as a business envelope.

I may have been done on December 7th, but I won’t know for sure until my firm submits the attached form with all my hours. 625 auditing hours, 100 review hours, 1,250 total assurance hours (including those audit and review hours plus other assurance engagements), 100 tax hours, plus elective hours making up no less than 2,500 total hours. I’m certain I’ve met all the hours.

Any leaves of absence taken in excess of those allowable (prescribed by Regulation I) will extend your completion date. The allowable leaves of absence are as follows:

  • 8 weeks vacation
  • 5 weeks staff/job training
  • 5 weeks illness/compassionate leave

I did some quick calculations and I’d be surprised if I’d taken more than those amounts off over the 2 2/3 years I’ve been working in public accounting as of the end of this year. But there’s more — any other paid/unpaid leave plus time spent at the SOA and writing the UFE is also added back. 4 weeks for the SOA and 1 week for the UFE.

My best guess is that it will be sometime in mid to late January before I’m clear to put the letters behind my name. The Waiting is the hardest part.


Variety and experience at mid-size firms

I’m going to have a fast-paced week again. This week I’m working on two clients from jobs that have wrapped up field work and two clients whose field work has yet to begin.

On the two post field work jobs, I’ll be auditing the consolidation of several large private companies and clearing review notes and documenting big picture issues on the audit I just wrapped up last week.

On the two pre field work jobs, I’ll be supervising a group of junior staff working on some small company compilations and reviews and beginning the planning on an audit that goes in February, and interim work that starts the week after this one.

It’s tiring but it’s exciting to have this much variety and experience already in my career. Makes me glad I chose a mid-size firm.


The best place to launch a career

I’m knee-deep into my third year working as an auditor, and that means I’ve nearly met my experience requirements to call myself a CA. By my calculations I’ll qualify somewhere around January.

Over those 2+ years I’ve gained valuable experience working with clients in many different industries. The opportunity to learn is literally limitless, and it’s probably the best thing about the profession.

Each year BusinessWeek ranks the best companies for new college graduates, and this year the top three spots were occupied by three quarters of the Big Four. Deloitte is tops, followed by PricewaterhouseCoopers and Ernst & Young. KPMG finished a surprising 11th. Grant Thornton also made the list (73rd).

They are among the first to rethink how to recruit college grads, keep them happy on the job, or just keep them at all. Ernst & Young uses Facebook to let prospective employees talk freely with real ones. Deloitte will show a rap video about office life—made by interns—to give students a realistic view of the company. And PwC requires some bosses to get a second opinion on their evaluations of new hires to make sure the feedback is clear enough, the goals ambitious enough for kids who are uncomfortable with ambiguity.

Using Facebook to recruit better doesn’t necessarily make a place a solid career launch pad, nor would a rap video. (I think Facebook works a bit better. The video will probably alienate more people than it attracts.) Clear feedback and ambitious goals will make PwC a great place to launch a career because it will help new graduates get used to the work environment compared to university.

But it is the experience of working with a wide range of clients that is most valuable in terms of launching a career.


Mid-tier firms offer better experience

So says this recent story on Accountancy Age, quoting a Cantos interview with the ACCA’s head of development, Tony Osude:

“If you went to one of the mid-tier firms, one of the beauties about being there is you might not be paid as much necessarily, but you have much more hands on experience. You can expect to actually meet your clients in the flesh and have much more dealings with your clients and also, importantly, if you want to stay in practice and recognition is important to you, there’s a greater chance of being recognised and career tracked.”

I have worked only at my current mid-size firm, so I can’t give a first hand comparison of the difference between it and a Big Four firm.

I know that at my firm, I was given greater responsibility on files fairly quickly after starting, and when I started there I was as green as you can get. I thought a discontinued operation was an error message in Windows.

In a non Big Four firm, you’ll generally have more opportunity to effect change within the organization, and there’s a better chance the firm will be on the cutting edge technologically speaking. I have a feeling the first firm to truly go paperless, if that ever does happen, will be a small one.

In a non Big Four, you’ll have more direct client contact because the engagements are smaller – the team is smaller, the risks are lower, and the client is less complex. With fewer staff on the audit, the lower level employees will necessarily have to take on more responsibility, leading to more client face time. Because the work is less complex, lower level employees can work with the client and have the necessary expertise to do so.

There are great opportunities within small firms and students should know all the options when they are considering where to apply. It can mean the difference between a rewarding few years leading up to getting their designation versus doing nothing but low-level rote work.