IAM-007 – A New Way of Getting Internal Audit Engagement Feedback

Engagement Survey FormOnce upon a time, there was a QAR. We passed! The feedback included a recommendation that we use client engagement surveys.

I always avoided client surveys for three reasons:

  • Survey fatigue, which leads to a low response rates.
  • Survey biases (e.g., nobody is perfect, don’t slap a tiger)
  • Once I have a number, what do I do with it?

I wanted to get some input and to be able to document that feedback, so as usually happens when I meditate on a problem, I pulled together a Frankenstein solution. My approach was driven from thinking of the engagement from the audit client’s perspective. If we want to get better, we have to get better in their eyes.

Life as an internal audit client

Being audited sucks. It takes time away from what you need to be doing. The auditor is asking questions (re-asking questions), requesting documents, emails, calls, meetings, responses, corrections, fusses and fights. It costs me time and money.

As internal auditors, we should always be looking for ways to decrease the cost of an audit from the perspective of the audit client.

Why are the internal auditors here?

Audit clients go through the five stages of grief and loss (http://psychcentral.com/lib/the-5-stages-of-loss-and-grief/000617):

  • Denial
  • Anger
  • Bargaining
  • Depression
  • Acceptance

Can you see how different that his from our perspective? As internal auditors, we should be selling the value of our services. I break it down into four value drivers:

  • Documenting processes (flowcharts and narratives)
  • Providing assurance to senior management and the board
  • Finding problems before the get away from us
  • Providing insightful recommendations

How do I measure all this?

I built a form that I send to individuals who were involved in an audit. It measures perceived cost and perceived value. The relationship of those two things is what gives us the best picture of our performance (especially from their perspective).

My model also takes into account that you don’t get a linear relationship between cost and value. There is a diminishing return. We provide a ‘sweet spot’ for the audit client to know what we are targeting.

The real value though, comes from the comments I solicit from those replying. I ask the audit client to provide advice on how we can do better. And I make it clear that we will produce actionable items from their feedback.

This effort has done something quite special. Beyond the information I’ve gotten from the survey (actual responses!), it has improved the relationship between internal audit and management.

I’m making this survey form available for your use. Just go to internalauditmastery.com/engagement.

 

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