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Internal Auditing Has an Identity Issue
Episode 616th September 2021 • Audit Bites • Robert Berry
00:00:00 00:44:55

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What do you do for a living?

Are you an auditor who struggles to answer that question?

You're not alone. But if you can't answer this simple question, how can you expect your clients or the general public to understand what it means to be an internal auditor?

Do you even know what people are saying about you?

If you not, you're going to be surprised in the episode. I'll show you what people think you do and we'll talk about how to fix it the identity issue.

www.auditbites.com

https://youtu.be/8xHhBHXdnZo

Transcripts

Rob Berry 0:04

Welcome to audit bites, the show where we give you bite sized chunks of information and education to help you excel in your audit career. Join our hosts, Robert Mary as we tackle another tough auditing topic this week.

Rob Berry 0:32

All right, all right. All right. Hey, guys, welcome to episode number six of audit bites. Today's topic, internal auditing has an identity issue. That's right, you heard me internal auditing has an identity issue. audit bites is the first live show about auditing. That's right. The first we are available on all podcasting platforms that is Apple, Spotify, Stitcher, any anything, any of the platforms where you like listening to podcasts, you can find me there. And guess what, you can also get CPE just for watching me, go to audit bikes.com. For details. Again, today's topic, internal auditing has an identity issue. And let me tell you where this all started with me. Many years ago, one of my childhood friends asked me, What do you do for a living? So I said to him, I'm an internal auditor, and you know, I proudly puffed out my chest. He looked at me and he said, You mean, like the IRS? Oh, well, what else did I expect? Not everyone knows what we do and how we do it. Heck, most of us can't even explain what it is that we do. And you know what happens? We walk around with our head in the sand acting as if everyone should understand what an internal auditor actually does. Clients are confused by the words that we use to describe ourselves. And Heck, even the Institute of internal auditors definition of internal auditing will leave the layman lost in confusion. Now when I say that I'm not saying that to criticize the Institute of internal auditors definition, because I actually like it, and I actually understand it. But since we're here, let's talk about that definition for just one moment. So here it is. On your screen. It says that internal auditing is an independent objective assurance and consulting activity designed to add value and improve an organization's operations. And that was just the first sentence. It goes on to say it helps an organization accomplish its objectives by bringing a systematic disciplined approach to evaluate and improve the effectiveness of risk management, control and governance processes. Now, that's a lot. If you're listening to me right now, and you understood all of that, let me know in the chat, by the way, how are you guys doing? I didn't even ask today. That's unlike me. So how is everyone you know that when you come into a room where I am, what I'd like for you to do is drop the emoji into the chat that signifies the mood that you're in right now. You can do that for me that would help me to know how you are because I do care about you. Heather is here and Heather says blah, blah, blah, right? That's a very long definition of internal auditing. But here's the thing, Heather, personally, I get it. I understand it. And I also appreciate this definition. But here's the problem. If you hand that to the average person and ask them what it means, you are going to get the deer in the headlights look. And I always love it when Hell is with me because Helle brings up a good point. He says the mission of internal audit is better than the definition. Yes, it is. The mission is to enhance and protect organizational value by providing risk based and objective assurance advice and insight. But how I would say if you give that to a layman, he or she would still not understand what it is that we do. But it is better. But again, remember, I'm not criticizing this because these definitions and the mission, it fits us because I actually get it and understand it. If I'm talking to another audit practitioner, they will get it and understand it. So that brings us to today's topic, my friends. Internal Audit has an identity crisis. When people don't understand what you do, they will say and describe it in a way that makes sense to them. And if you don't speak up about it, then it may become the unsaid expectation and norm.

Rob Berry 5:10

So what I'm saying is there's an identity crisis for internal auditing, and it is partially your fault. And my fault as internal audit practitioners, Heather, it's a migraine day to day. Oh, I hate to hear that my friend, because I know you get some pretty bad ones. Yeah, I still remember that my friend. So I'm sorry. And I hope that you get better.

Unknown Speaker 5:36

So

Rob Berry 5:38

let's talk about this. Recently, I came across an article talking about internal auditing that was very disturbing. And so we, as practitioners are going to talk about this today, because you need to see what people were saying about you. And they're not bad people. This is what they think about our profession. Because we do a terrible job of explaining to people what it is that we do see, I believe in personal accountability, and that's why I'm blaming it all on us. So as I walked through this article, I don't want anyone to go and spam the author of this article, what I want for us to do is to figure out ways that we can describe what we do better so that others have a better understanding of it. So let's dive right into it. This article first appeared in this article first appeared in The Wall Street reporter, and the way it appeared in The Wall Street reporter was like this, here's the screen print of it. Now, the Wall Street reporter actually is a reputable organization. And what they do is they curate content, meaning they go out and they scour the Internet, and they look for keywords, some of those keywords said internal audit, and they said, Yes, we're going to put this on our website. So if you look, the title of this article is, what is internal auditing, and the author is Leanne Kelly. But when you click on it, it actually takes you back to the website where the article can be found, which is here. Now I've grabbed screen prints of the article, and what we're going to do is we're going to go through it. And I've highlighted in gray, some things that just don't seem right. This is not what we do. But again, you should know what people think about what you do. You should know what is out there in the public sphere, regarding the profession that we've chosen to be in. And how says, We have been our own worst enemy at times, with some liking the cloak of mystery around what we do and what we are. Oh, yeah, yeah, some of us. We like that cloak of mystery surrounding what we do very well said, hell, and water is here and wrong. Juana says Good to see you, my friend Juana. It's good to see you too. We actually need to catch up because it's been too long. All right. Like I said a few minutes ago, I am not shaming the author. This is being done for constructive criticism. So here we go. The article reads, public companies are subject to all types of audits, especially when it comes to their financial record keeping. There are external audits of financial documents, as well as internal audits of the controls behind financial reporting. So let me stop right here. The last time I checked, audits, strictly of the controls surrounding financial reporting are done by Sarbanes Oxley professionals. Now granted, I do realize that sometimes audit departments absorb summons, and in some instances, all of the Sox duties, but these are Sox audits. The article goes on to say, while the former involves external third party accountants, an internal audit is performed by an entity's own accountants. I'm going to stop right there because accountants perform internal auditors. If you're listening to this live or on the replay, just type into the chat one if you are an accountant, and type two, if you are not an accountant, but you're an internal auditing professional. I would like for them to tell that the fact that accountants performing an audit does that like for someone to say that to the scores of great auditors who are not accountants, and who are doing really cool things and information technology, artificial intelligence and data analytics. Better yet Tell that to auditors who work for Burger King or McDonald's or, you know, you name the organization that doesn't necessarily rely on accountants. But anyway, your article goes on to say, together, there are two sides of the same coin. One focus on transparency. Now, let me just stop right here. If we go back to the definition of internal auditing that I just read, nowhere did it say that the primary purpose of internal auditing was transparency so Again, I'm not doing this to shame the the author, I'm doing this so that auditors know and understand what is being said about us in our profession. If we don't do anything to correct that, then that's our fault. Right? personal accountability here. How says all accountants are not internal auditors and all internal auditors are not accountants. Thank you hail.

Rob Berry:

Alright, so the article goes on to say, this is the part where it gets really interesting, my friends, internal audits became an important staple for public companies after the passage of the Sarbanes Oxley act of 2002. This is not true. I've been an auditor since 1990. Well, I won't say the year because then I'll give away my age, but the gray hair gives away my age anyway. But my point, My point being, I was an internal auditor before Sarbanes Oxley. And as a matter of fact, I was the director of Sarbanes Oxley for a $5 billion financial institution where all I did was Sarbanes Oxley because there was a separate internal auditing function. So this article gets that wrong, greatly wrong. Um, but it goes on to say, this piece of legislation holds managers legally responsible for the accuracy of a company's financial statements. Right, it holds management responsible. It also says as a result, it is in the best interest of the company to maintain transparent, accountable control standards, and have documentation to back them up. Alright, so let's go back to our audience here. Heather says she is an internal audit professional, not an accountant. Right, Heather? I see you got that. Kevin black is here. Kevin says number two. So there you go. Becky says not an accountant, but an internal auditor. Hmm. And Landon says Well said, Landon, thank you. I appreciate that. But we're not done yet. My friend. I feel like an infomercial. Right with Billy Mays. But wait, there is more. All right. And in all seriousness, there is more to this article. So the next section of this article is aptly titled, what do internal auditors look at? And it reads, internal audits, look at the processes and controls for financial reporting. Really, that's it to ensure they're traceable, and compliant with IRS and sec standards. So I'm going to stop right here. So auditors, how many of you all know IRS standards? I don't know anything about IRS standards. And yet, I've been doing this for almost 25 years, so I must be a pretty bad auditor. So this is what they're saying about you. Oh, as internal auditors, us as internal auditors. It continues, they're designated to be comprehensive spanning every part of the reporting process. So again, let me just put a pause in that, again, we only focus on financial reporting, according to this article, that was also in a very reputable organizations online internet form. He goes on to say in general, a good audit will seek to verify several key objectives. One, certify the integrity of financial information. Is that what you do as an engine auditor you certify the integrity of financial information? Okay, to promote accountability within financial reporting. So is that what you do Kevin black? Is that what you do as an internal auditor? Becky, is that what you do, Landon? Is that what you do? And third, reduce opportunities for fraud or non compliance? Fourth, ensure compliance standards and best practices ensure I'm taking issue with that because we only provide reasonable assurance we don't completely ensure but okay. And then last but not least, risk management and quality control and accounting. So now internal auditors provide will will risk managers now I guess. Okay. It goes on to say companies tend to engage in many different types of audits targeted at specific facets of its accounting practices. So again, internal auditors, you look at accounting practices only, according to this article that was in the Wall Street reporter. Now how says non public companies have no sec standards, even though I have no idea what that what that is anyway, right. Becky says, Not in the slightest. That's not what you do day to day, Becky. That's not what I do, either. It's not what any of us do as internal auditors. But we're not done yet, folks. We're going to go through this. And then we're going to talk about what is it that auditors do? And is there a way? Or are there ways that we can explain what we do in more layman's terms for people? Yes, there are. We'll talk about that.

Rob Berry:

So this article goes on to say in this next section, how can companies learn from audits, and it reads, you know what, this one wasn't too bad. So we're gonna skip this section, I'll put a link to it, so that you can go to the article yourself. But I don't want to waste anyone's time, this one wasn't too bad. And you can read the full article, I want to be cognizant of your time. But let's go to this next section where it says, who performs an internal audit. Now, this is extremely interesting. So let's see if you agree with the contents here, my fellow internal auditors, and it reads, as the name implies, an internal audit happens within the company. So far, so good people. Typically, it's performed by a qualified internal auditor. This is an accountant, or other financial services expert, trained to look at current standards and practices through a critical lens. So let me just say now internal auditors or accountants or financial services experts. Again, I want you to tell that to the good auditors who work for Walmart, or target, or McDonald's, or Burger King. As you guys can see, I'm a little hungry right now, because Burger King and McDonald's keep coming up right? Or Disney? I bet they'd be surprised to learn that they were financial services experts. Kevin, did you know you were a financial services expert? How did you know it will help you might be a financial services expert. Heather, did you know you were a financial services expert, Becky, did you know you were a financial services expert. Okay, now, it continues. Their job is to uncover and help correct malfeasance before it becomes a matter for the IRS or the SEC. Now this perception is a part of the reason that internal auditing is typically viewed negatively at companies, it is not our job to uncover malfeasance. Now, that may be something that happens while we are doing our job. But our job is to evaluate processes, right. Okay, before we get there. All right. So let's go back to my lovely audience, Becky is saying Nope, not in the slightest. Lori is here. Hey, Laurie, you showed up. Hey, Laurie said no, that's not what I do. Kevin says I didn't know that's good. Man. Kevin, I'm trying to do a show here. Man, you cannot be sarcastic in the comments. You made me laugh. Kevin said he didn't know that that was what he did. And that is good to know. But now that you know, you've got to do something different. I mean, if you didn't know that this was your job. That means that you've been a terrible auditor for all these years. It means that you have not been sufficient and efficient at doing your job. All right. The article goes on to say specifically, I has three objectives. Let's talk about those. Assess the internal controls within a company. Okay. Okay. Ensure is that the drink that you drink the issue, ensure the company is in compliance with federal and state laws and regulations. So what do compliance officers do then? Oh, sorry, let me get back to this article. And recommend a course of action to rectify any issues identified during the audit.

Rob Berry:

It goes on to say to achieve these goals and meet the expectations of the company, internal auditors need to have a keen understanding of IRS and sec standards. Really, as well as a thorough understanding of accounting and bookkeeping practices. Heather, do you have a thorough understanding of accounting and bookkeeping practices, my friend? Again, I've been an auditor for over 20 years and I don't know any IRS rules or regulations. And the SEC, like hell mentioned early earlier only applies to public companies. And it's still not a major part of internal audit work. Now, it goes on to in the article continues. Many companies also mandate that their IRAs get certified by the Institute of internal auditors. And let me get let me let me just point some things out to you guys. Right now. If you look at this article, the screen print that I have, you'll see that the Institute of internal auditors is in blue what allow companies do is they do what's called keyword stalking. They write all these articles on the internet. And they put in keywords so that they can get indexed by Google and picked up. So now this company has done a link to the Institute of internal auditors because that helps in their Google ranking, which means that there's a lot of misinformation out there. Okay. Again, I'm not doing this to criticize the author, I am criticizing the content, but I'm bringing it back to us as internal auditors because we make it difficult for people to understand what it is that we do when our jobs are really not that difficult to explain. So let me pause for just one moment. I am Robin berry you are listening to and or watching audit bytes. The first live show about internal auditing well about auditing in general, we are available on all podcasting platforms. And if you will, do me a favor, go over to Apple and Spotify and give this podcast a five star rating. I think we deserve it, don't you? Yes, of course you do. Today we're talking about the identity crisis with internal auditing in our profession. The identity crisis is our fault. I'm going through an article that appeared in Well, a very reputable online source recently that talks about our profession. And most things in that article were wrong. We're dissecting that article right now, not to criticize the author, but to bring some accountability to us, because we make it difficult for people to understand what it is that we do. All right, now that I've caught everyone up. Let's go back to the audience just for one moment. How says he see the links to the AI's website. I wonder if the author actually clicked on it? That's a very, very that's a very good point, how I'm trying not to be mean towards the author, but thank you how how Garin said it, not me. Alright, so the article then goes on to talk about the difference between internal and external auditors. And it reads, The biggest difference between internal auditors and external auditors is who appoints them. Internal auditors are appointed by the company to undertake a willing audit of practices and protocols. external auditors may engage in the same duties where if they engage in the same duties, then why would Why would you? Okay, let me just finish this, it says, but they're appointed by shareholders via a vote. And I'm just gonna leave that right there. And we're just gonna move right along. Okay, we're gonna move right on. It then talks about internal audit reports, how to answer your question, I think they did click on the i a link, because they they listed the five C's. As for what internal audit reports should contain, you know, the condition criteria and all that good stuff. So I'm guessing they did click on the link enough to get the five C's. So in for the sake of you guys, this time, we're going to move right along, and we're not going to talk about that section. Now. The next section of this article says audits go beyond accounting. wacky until the first. The first part of it all you talked about was accounting. Okay? And it reads, while the primary motivation for many audits is to ensure proper and transparent accounting and financial reporting. Alright, I can just see his face right now. And I'm gonna wait for the snarky comment. Let me go back to this and it reads, while the primary motivation for many audits is to ensure proper and transparent accounting and financial reporting, audits can span any facet of operation. Okay. It continues, many companies audit processes and controls to improve operational efficiency, reduce liability, protect assets or improve productivity. Oh, okay, that sounds a little better.

Rob Berry:

These primary benefits give way to the secondary benefit of clear and present accountability when it comes to book keeping.

Rob Berry:

I'm really confused now. It's like who's on first what's on second? He goes on to say for example, a company may audit its cybersecurity practices, keyword stalking here, folks. Let's just be clear about what this is. In doing so it enhances its data archival practices to better protect customer financial data. Doing so raises its standard for compliance with sec cybersecurity guys in the event, you know what, let's go back to the audience for a minute. How has the really good emojis it's like what? Really? Yeah. All right. But my friends, we're not done yet. The next section says internal audits are standard practice. And it says every public company practices internal auditing as a rule Well, still not every public company, depending on your market capitalization. But that's a whole nother thing altogether. Two, internal audits help ensure outward compliance by keeping a company on its toes. As standards and practices change, and expectations for transparency and compliance grow more stringent internal audits are a company's first line of defense, defense against fines, penalties and investigations. Now, I want you to take note auditors, some people actually believe that you are the first line of defense, think about it when something happens, the first thing you hear is where were the auditors. But let's let's not get bogged down by the fact that the Institute of internal auditors has three lines of defense model, which was updated recently, and I forgotten the new title for it. Forgive me anyone with the AI who's watching right now, because I know you guys watch. But let's forget about the fact that let's just forget about the fact that the AI has the three lines of defense model. What most people believe is that we are somewhere in that first line of defense whenever fraud happens. Now, let's bypass the management team that has oversight responsibility in an organization or a management team that in rare instances, committed the fraudulent acts. The auditors are the first line of defense, according to this article that was written about us and about you. So as I said, when I began this podcast today, what we are talking about is internal auditing has an identity crisis, what we actually do and what people believe we do, there's a big gap there. And that gap is partially your fault and my fault as internal audit practitioners, so we have to stop getting mad at other people when they get it wrong and have some personal accountability in the way we explain what it is that we do for a living. Hopefully, everyone is on board with what I just said there. If you're not on board with what I just said, and don't believe that we should take personal accountability for what we do. You are wrong. Clarence my man, good to see you. Always good to see you. Clarence says, It's funny, people will always talk about auditors, but they know nothing about what we do. We are the first ones blamed when a problem is found. But never say anything good when we find a problem, because we are too strict, my man. And you know what, if I had a mic right here, I would just drop it for you. Just Alright, so it was over clearance to sit at all we're ending Good night football. Just kidding. I'm just kidding. I'm sorry, we were on the first line of defense. He continues, the article continues, with responsibility fall into internal stakeholders to uphold accounting and financial reporting best practices, it's in every company's best interest to be its own biggest critic, critic. In fact, this is just as important for investors, you need to take time to analyze your investments, financial reports, what to learn more sign up for There you go. And now they pitch their newsletter. So understand that there's a lot being said about you, us, our profession. And what we do. A lot of this is mis information. And a lot of it is wrong. So let me let me just stop right here and just tell you, this is what they say about what you do.

Rob Berry:

Now, I want to be cognizant of everyone's time. I know that the LinkedIn invite said that it was 30 minutes. There's a problem with LinkedIn. Now, I scheduled these podcasts in stream yard and it'll only do 30 minutes at a time and it won't let me update it. I really would like for this to run for about 45 minutes. But here's what I'm gonna say. I'll ask you guys, if you're here. And you'd like for this to continue type of yes in the chat for me. If not, there'll be a part two. And we'll just come back and finish next week with what is it that auditors do. I only got about 10 minutes left. And then we can wrap this up. But I like engaging and interacting with you guys and I want to be cognizant of your time because you probably only scheduled 30 minutes for us today. Now while I'm also here, I want to ask you to do something for me. Right now. I'm working on building a really good audit. community, that's what's lacking is a community for us to actually engage and talk with one another. When I say community, I'm not talking about these one off webinars where it's one way communication, I mean, a community where we can talk back and forth with one another on zoom on clubhouse, on Slack, on telegram on WhatsApp, any other platform that you would like to do that on. And while I'm building that community, I'm going to ask you to go to awesome auditors club. That's right club, not comm drop in your email address for me while I build this email list, so that we can have better communications with each other. Here's what I'm doing. In this community, we will have some zoom meetings, we will have some telegram meetings, we will have some clubhouse meetings where we actually talk dialogue to way we ask questions of one another and we help one another so that we can combat this misinformation that we have here. By the way, if you sign up right now, at awesome otters club, you might get a free gift coming from me, you may just get maybe an hour of CPE for free. So I am Robert Barry, this is audit bites the first live show where we talk about audit. Today we're talking about the identity crisis that internal auditing has. I'm inviting you to join a community where I'm going to ask some other people to join me on this journey. How Joe Irv and Kelly packs and a bunch of my friends so that we can have open dialogue and not these one way webinars where you don't get a chance to ask questions. There are a lot of junior auditors out there who email me a lot on LinkedIn. They just have questions. We have answers, we owe it to them to give them some of the answers that they need. Awesome auditors club. Wow, awesome auditors club because we're freaking awesome at what we do. That's why. All right. So let's go back to my friends here. Hell is saying Yeah, man continue. What I was saying, Yeah, I want to know what you do was my friend and she's not an auditor, and she's like, what the heck do you do? So that's probably why she said yes. Heather says yes. Oh, Nicoletta nicoleta says yes. And Lori says, So what are some suggestions on what we can do? How do we effectively and correctly promote the audit function? I'm glad you asked my friend. Let us continue. Before we get to exactly what it is that we do, and how do we explain it with three simple phrases, I'm going to set a baseline so that everyone is on the same page. So hopefully, you'll give me about three minutes to set a baseline. And everyone agrees with what I'm saying here. So first, let's just take any company, Every company has a mission, the mission in every company is really surrounds who we are and what we value, right? You're on a mission to do something because it's a part of who you are, as a company, you're on a mission to do something because it is what you value, right. But also, Every company has a vision, that vision is what you want to become as a company. If you go to Starbucks as website, they'll tell you what their mission is, but they'll also tell you what their vision is as an organization. But on top of that, every company should have a strategy. Now that strategy should detail how they are going to achieve the mission and the vision. So that strategy should be how we are achieving the mission right now. And how we're going to achieve our vision for the future. Right? So far, everyone should be on the same page with me. If you disagree with any of this, let me know. I'll then tell you, you're wrong. No, but in all seriousness, you have a mission of vision and strategy after strategy.

Rob Berry:

Okay, house's mission is the what vision is the why, yeah, I can go with that too. But after that, you have goals and objectives. Now your goals and objectives should be measurable. And that is how you're going to gauge the success. That's going to be how you gauge how successful your strategy is, which should be in line with the vision and the mission that you have. So far, so good. But after that, you're going to have some policies, those policies are the principles, the rules and the guidelines that you follow at your organization. Right. So those policies should be in line with the goals and objectives, which should be in line with the strategy which should dovetail into the mission and vision that you have as an organization. But then after that, you're going to have some procedures and some processes that you put in place. This is how we do what it is that we do as an organization. If you work in the payroll department, they're going to be some policies, those policies say when you get paid, then you're going to have some procedures, those procedures are going to say how that process works to get you paid. Alright, so, so far, we are good mission vision. Strategy goals and objectives, policies and procedures. Anybody disagree with that? Since we're on about a seven second delay, I'll pause for a minute to see if anyone disagrees with that. I understand there may be something additive, because I'm keeping this very brief. But is there any disagreement, and this is pretty much the structure in an organization in Heck, in your personal life, this is how you run it, we all have our personal mission, our personal vision, our values that drive us. Same thing with companies? Well, for our internal audit professionals, those procedures and those processes, that's our primary playground. Now granted, we do look at goals and objectives and policies sometimes, but those procedures are our primary playground. And when we audit those processes that are in place, at the end of the day, we're really looking at a few things really just to, we're looking to give management some assurance that either a things are operating as intended, good job, your controls look good, and your environment or B, things are not operating as intended. And here are some things that you can do to make it better. At the end of the day, it's really about that. A Yeah, things are or B, things aren't happening. Al says the author of the article might disagree. I'm sure he or she would disagree. So the primary playground for an internal auditor is looking at those processes those procedures. Now we do a little bit more than that. But I'm trying to keep it simple, layman's terms, because we got to be able to explain this to our mom and dad at the barbecue. Right? So at the end of the day, we're looking at those procedures and those processes. But I'll do you one better than that. Essentially, there are three things that we look at when we look when we're evaluating those procedures in those processes. Alright, you guys ready for this? This is layman's terms. I said this to my grandmother, and she got it and understood it. So here's what you tell your grandmother, we looked at a few things surrounding processes one of those processes effective in achieving the goals and objectives that they were supposed to achieve. For example, before when the motor vehicle was first created. We had no seatbelts.

Rob Berry:

They invented the seatbelt. Actually, Volvo invented the seatbelt and did not patented, they gave it to the world for free. Now, if you look at motor vehicle accident statistics, you will see that since we began wearing seatbelts, well, automobile deaths have gone down, it still happens, but it's going down. So we can say that the seatbelt is an effective control, right? So auditors look to see if processes in an organization are number one effective. If they are effective, great. If they're not effective, then we have some recommendations. The second thing we look at, though, is if those processes are efficient, if you're sitting here using a calculator when you could just don't dump something in Excel. That's not really efficient, and it can save you time. So is it effective, isn't efficient? And then the next thing we look at is, are we in compliance with laws, rules and regulations? Now you notice, I did that as a titrating down? Because we're not primarily looking at compliance with laws, rules and regulations. It is a part of our job, but effectiveness and efficiency are at the top. Why do I say that? Well, I say that because well, we have this function called a compliance function. A majority of what your compliance function is looking at is compliance with laws, rules and regulations, which is why we need to partner with Chief compliance officers in organizations because there is a healthy marriage between our two functions, because next they'll be looking at efficiency, but they're mostly concerned with compliance. And they'll look at effectiveness too, which is why again, as internal auditors, we should be partnering with compliance officers in organizations because there's a healthy relationship there. There's a healthy marriage there. But what do we do? We look at processes, we look to see if those processes are effectively achieving the goals and objectives that they're set out to achieve. If so great. If not, we might have recommendations, then we look to see if those processes are efficient. If they're not efficient, then maybe we can help our companies save some money, then we look to see if we're in compliance with laws, rules and regulations. Again, this is the Robert berry my grandmother understood this when I said it to her definition. The Institute of internal auditors definition is still very good. It is what we should go by as auditors. But when we are trying to explain what we do to a layman, someone not in our field, someone who has no clue what we do, you will not bring out that long definition of internal auditing. If you do you will get the deer in the headlights look. If you do, you will get the result of well, that article that we just broke down that over 80% of that article was just wrong. This article was on the wall street reporter, and it will get what we do for a living wrong. So let me say, again, I am Robert Berry. This is episode number six of audit bites. The first live show where we talk about internal auditing. Today's topic was internal auditing has an identity crisis. What we did was we went through an article that was in a reputable online source that talks about what we do, and it got everything wrong. Whoa, Okay, I won't say everything. That's a definitive, it got a majority of the things in the article wrong. The reason that we're here though, is not to criticize the author of that article, we are here to learn what we can do better in taking personal accountability in describing to people what it is that we do for a living, whether that's our fellow colleagues, or our clients or our loved ones. And it all started when a friend of mine asked me, Robert, what is it that you do for a living? So what is it that we do in layman's terms, will we evaluate processes in an organization and we look to see if they are effective, we also look to see if they are efficient. And we also look to see if they are in compliance with laws, rules and regulations. Now, for some of you, I've very much so over simplified our job as an internal auditor. But again, Episode Six, audit bites, internal auditing has an identity issue. If you don't believe me, check out the article, I'll put links to that article so that you guys can read it for yourself. Hell actually read it. He sent it to us in a in a group email. And he was like, Whoa, this is bad. I agree. This is bad. Hello, still here. And hello says effectiveness, efficiency and compliance to support the organization's pursuit of its mission, vision and strategic objectives. New a mission. Thank you for summarizing what I said, hell, this

Rob Berry:

is why I love you, man. You're more eloquent than I am. But this is what I've always preached as internal audit, as our job as internal auditors. Again, I am not knocking the eye as definition because I get it. When I teach courses, I actually dissect the definition so that auditors can understand what it truly means. But if we are talking to people who don't know what we do, we need to speak in a language that they understand. Otherwise, we end up with articles that were just as bad as the one that we were dissecting today. So I want to thank you guys for being here. Again, I'm on a slight seven second delay. So I'm going to pause for just one moment to see if we have any other comments that might come in. While I'm on that polls, go to my website, that audit guide calm, you will find online training courses. Some of them are based on this podcast and a very good podcast that I do with Joe Ervin and Kelly Paxton called the Friday froster where every Friday we talk about fraud. Also, if you are listening to this podcast live today, right after this, you should go to Joe and Kelly's book club. Yes, they have a virtual book club today. It's a book and a Movie Club. And I think it's only about 20 bucks. That's why I'm gonna hop off here and go on it because we talk about fraud and auditing. Joe Ervin is a great host if you've never seen her speak, you should probably sign up for this thing today. And it starts in about 15 minutes. The other thing you will find on my website is information about me because I am an audit trainer and a public speaker I chapters if you need a kick butt trainer, you need to be calling me right now. You will also find audit merchant my website Yes, audit merge. I love audit t shirts and stuff like that. Why? Because I'm just the creative spirit and I love internal auditing because what we do actually saved my life. I don't know where I would be if I wasn't an internal auditor for as long as I have been one. So before we go, thank you guys for being here. audit bytes episode number six. There's an identity crisis with internal audit. I am Robert berry look for us on your favorite podcasting platform. Until next week, thank you for tuning in Good night.

Rob Berry:

Thank you for joining us on this episode of audit bytes. If you want to do more, see more, be more, check out our website that areca.com where you will find while at training, audit merge. Yes, we have had shirts and other apparel as well as past copies of this podcast and the Friday fraudster podcast www.thatauditguy.com

Thanks for joining us.

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