10 Interview signs the Internal Audit Function you are applying for is NOT what it’s supposed to be!

October 21, 2019 | By Risktal Thought Leadership

Our article attempts to highlight a few signs of a dysfunctional internal audit function that could be identified at the interview level. There are many reasons why an internal audit function could be dysfunctional but we believe one key reason is the lack of understanding or ignorance of what internal audit is all about by the stakeholders. Hence, our starting point here is the definition of Internal Audit according to the Institute of Internal Auditors who are the regulatory authority of this profession:

“INTERNAL AUDIT is an independent, objective assurance and consulting activity designed to add value and improve an organization’s operations. 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.

Our experience in the Middle East has unfortunately identified that internal audit in many organizations is more of a cosmetic as opposed to an effective, value adding contributor to the business. That, in no time reflects negatively on the diligence and morale of the internal audit team who would become frustrated about the shelving of their work which if addressed could add the desired value to the business or in the absence of support from the Board and/or Owners lead the Heads of IA functions to adopt – “Let’s not rock the boat” & “Let’s tie the horse where its owner wants it” mentality and buddy up with Management…Hence, whenever you see an organization where management “love” their internal auditors, know there is something wrong.

Many professionals have the technical capabilities and the right intentions to add value to an organization when they apply for a position of Head of Internal Audit, however, they will be hit by an ugly truth once they get the job. We are summarizing here signs that could highlight to you at the interview stage that the internal audit function is dysfunctional:

  • First interview is held with the CFO and/or CEO – No one will recommend a strong auditor to audit them! The Board/Owners/Audit Committee should be the ones to determine the fitness of the Head of Internal Audit candidate.. Period!
  • Absence of a clear job description – Lack of clarity about the role of Head of Internal Audit is a recipe for failure.
  • Conflicting or confused expectations of the role – When you receive different articulations of the expectations of the role from the owners/board, CEO, CFO and Human Resources, know that you are jumping into chaos.
  • The position is not a C-Suite position – As Head of Internal Audit you are expected to audit even the Executive Management’s areas of responsibility, if the position is not a C-Suite and you respect your profession – Run!
  • Unrealistic resourcing – When interviewing for medium or large organizations and the expectation is that you will be the one and only auditor for the organization, while Internal Auditors are “Super Humans” – know it is a joke not a job!
  • When you are expected to fix all the organizations processes – the question that should be asked here is, what are the Executive Management actually doing in this organization?! Management are responsible for managing business risks, hence develop and document a comprehensive system of internal controls. Unfortunately, internal auditors in many organizations have agreed to assume the task of documenting the organizational processes at the risk of being held responsible for them!
  • You are asked questions that should be directed to CFO or CEO – “What would you do if we have a company incurring losses?” The right question is: CEO/CFO you have been hired to manage this company, what are your plans to address this situation? While Internal Audit could assist in a consulting capability in such cases, but if the Head of IA is more capable to turn around a company than the CEO or CFO, he/she might as well assume the top job!
  • When the interviewers discover your resume for the first time in the interview – enough said!
  • When the interviewers are late! 
  • When your compensation package is way off that of Executive Management.

There are many reasons why an internal audit function would become compromised; however, the key message that we would like to highlight is that Internal Audit is a value adding function, but that will not materialize unless the owners/board and Executive Management explicitly support this function; otherwise, it will be much more cost effective not to have this function in the first place.