The key to writing an effective audit observation is having a comprehensive structured process.
The Institute of Internal Auditors recommends a process known as the 5Cs:
- Consequences (Effect)
- Corrective Action (Recommendation)
As you develop conclusions, findings, and recommendations, you must present them to your client in a logical, complete, and objective way. This process provides an easy way to consistently develop and present your observations. The components in this process include all the information you will need to inform and persuade.
Developing this process can be an important tool for completing and reporting observations in a timely and comprehensive way. It allows you to present those findings to your reader in a logical, complete, and objective manner and, thus, enhances the chances of the client's buy-in and their agreement to your recommendations.
This process can also serve as a basis for review by supervisors and managers. It is supported by your work papers and gives complete and clear details of your analysis and the basis for your findings.
Why should you Attend
The audit observation is the most important part of an audit report. It represents the end result of weeks of reviews, analyses, interviews and discussions.It is used to bring significant issues to their attention that needs to be addressed.
How well you communicate that information is critical to influencing the readers and getting the results you are seeking.
A well-written audit observation will capture the readers attention and focus them on the important issues in the report that needs to be addressed. A well-written audit observation adds value to your clients by providing:
- Concise, understandable, and persuasive observations
- Actionable recommendations
Areas Covered in the Session
- Criteria (Standard used for comparison of area under review)
- Condition (Current status used in the comparison)
- Cause (Reason that the Condition does not meet the Criteria)
- Consequence (Risk if not corrected)
- Corrective Actions (Action needed to manage the risk)
- Exercises for each component
Who Will Benefit
- Chief Audit Executives
- Audit Directors
- Audit Supervisors
- Audit Managers
- Staff Auditors
- Government Auditors
- Compliance Auditors
- Internal Control Specialists
- Public Accountants
- Accounting Analysts
- Business Analysts
- Quality Control Specialists
Jonnie T. Keith has over 40 years of audit experience and has served as the Chief Audit Executive for the Metropolitan Atlanta Rapid Transit Authority (MARTA) for the past 10 years. His other audit experience includes serving as Operational Audit Manager and Senior Auditor at MARTA, Senior Auditor at Norfolk Southern Railway (formally Southern Railway), and Bank Examiner at the Federal Reserve Bank of Atlanta.
He has done numerous audit presentations and had an article published in the April 2005 Internal Auditor Magazine entitled, “Killing the Spider”. He has performed quality assessments of several major companies. These quality assessments ensure that the Audit Departments are conducting audits in accordance with the Institute of Internal Auditors Standards or the Government Auditing Standard as applicable.
He has a degree in Economics from Clark Atlanta University. His certifications include Certified Internal Auditor (CIA), Certified Fraud Examiner (CFE), Certified Government Auditing Professional (CGAP), and Certified Internal Control Auditor (CICA). He has been a volunteer instructor for the Institute of Internal Auditors for more than 10 years. In addition to teaching the CIA Review Course, he has taught Tools & Techniques for Beginning Auditors, Audit Report Writing, Operational Auditing, Audit Project Management, Communication Skills for Auditors, and Leadership Skills for Auditors.
He is a member of several local audit chapters including the Institute of Internal Auditors, the Association of Government Auditors, and the Association of Certified Fraud Examiners. He has also served as a Vice President and a member of the Board of Governors for the Atlanta Chapter of Institute Internal Auditors.