In my more than 35 years as an internal audit practitioner, I have encountered very few auditors who say their ambition when they were young was to become an internal auditor. Most end up in the position by chance and only later discover the many opportunities and benefits the profession offers. My journey to internal audit began when I was offered the choice between two positions at American Greetings Corp. — a budget analyst or a staff auditor. I chose the staff auditor position because I could not see myself doing the same tasks day in and day out, and the audit assignment offered an ever-changing work environment.
I was fortunate to spend 22 years with American Greetings, as it afforded me the opportunity to travel and work on every continent, with the exception of Antarctica. I was exposed to a variety of cultures, business practices, and, most importantly, people. I had the opportunity to learn a business from all aspects and perform reviews in all areas of operations, including procurement, distribution, logistics, IT, human resources, risk management, and compliance. I learned that my work priorities could change daily and how to get up to speed quickly on issues, the environment, culture, language, and people.
These skills proved useful when, 15 years ago, I was presented with the opportunity to launch the Internal Audit Division at the Virginia Alcoholic Beverage Control Board (VABC) in Richmond. Since taking the job, my priorities have changed daily, and I appreciate the diversity of our operations and the vast array of projects we undertake.
A Unique Experience
Fifteen years ago, Richmond was one of the few cities I had not visited. I quickly learned that the VABC’s mission is “to control the distribution of alcoholic beverages; operate efficient, conveniently located retail outlets; enforce the laws of the commonwealth pertaining to alcoholic beverages and youth access to tobacco products; and provide excellent customer service, a reliable source of revenue, and effective public safety.” The Board operates 348 stores in Virginia and has contributed more than US $1.7 billion to the commonwealth in the past five years. Our Enforcement Division has more than 100 special agents who are sworn and certified police officers, and we oversee more than 16,000 establishments licensed to sell alcohol. We work closely with the Virginia State Police; U.S. Department of Homeland Security; the Federal Bureau of Investigation; the Bureau of Alcohol, Tobacco, Firearms, and Explosives; and many local jurisdictions on law enforcement and security issues. The VABC is involved with numerous outreach efforts in the community, including Alcohol and Aging, Military Outreach, Youth Alcohol and Drug Abuse Prevention, and College Conferences on Alcohol.
Starting a division from the ground floor required me to gain an understanding of the operation by meeting with all 10 of our division directors to learn the agency, culture, and challenges each division faced. To fully understand our two biggest divisions — Stores and Enforcement — I spent two weeks in each division working in the warehouse, ringing sales in the stores, and riding along with our special agents while they performed investigative work and field operations. The wide range of operations and the issues the agency faced made me recognize that, as we developed our division, the talent we needed to recruit had to have a good grasp of retail, business process, and investigative skills.
Not knowing the area, I became involved with the Central Virginia Chapter of The IIA and worked closely with the state internal auditor to develop a contact network and learn more about how state entities function. One of the toughest obstacles I faced was that the state’s pay scales, which were not competitive with the private sector or local government entities; this required me to be creative in the recruitment process. I learned to work with the benefits I could offer, which included flexible schedules, competitive benefits, and, most importantly, one of the most diverse entities to work for to gain professional experience. The other important lesson I learned was to show your team members that you are one of them. Because of our limited staffing, I am involved in many of our reviews and investigations. The staff respects that, and it has significantly enhanced the bond among our team members.
VABC provides internal auditors many unique opportunities. Our division has been able to assist our Enforcement Division with data analysis and research in numerous investigations, including those related to 9/11, moonshining operations, cigarette/alcohol trafficking, and licensed activity (i.e., food to alcohol sales ratios or other reporting requirements related to establishments that sell or distribute liquor in the state). Our division has participated in undercover surveillance operations and assisted in covert tasks. We are proud that our work has helped enhance public safety in Virginia. The unique activities we perform have been a valuable asset for us in retaining talent and developing professionals for future advancement.
A Changing Environment
As the internal audit profession evolves, it faces many challenges. Acquiring and retaining talented individuals is a major concern that is always at the top of any roundtable discussion with CAEs. I see my career path as antiquated because I spent 22 years at one company and 15 at VABC. To retain talent, it is imperative that a challenging work environment exists, training opportunities are available, work-life balance is respected, and a sense of being part of a team is adopted by all.
I see generational differences in the workplace and believe that CAEs must be willing to adapt. My 25-year-old senior IT auditor sits 30 feet away from me and communicates with me via instant messaging, whereas I am more inclined to walk over to meet in person. We have made it work for both of our styles. I see challenges with recent college graduates who, upon entering the workforce, need additional training and guidance on how to personally interact with other employees. Our profession requires interaction as we seek information to perform our tasks.
I see audit functions constantly being asked to do more without any additional resources, and I see data analytics (see “The Data Behind the Curtain”) and constant monitoring becoming more important in how we do more with less. Technology changes have been instrumental in assisting me with my investigative work. I am fortunate to work for a law enforcement entity; I have access to all of the latest technology to assist me with the investigations we conduct.
I see internal audit functions becoming trusted partners within organizations. Each of us has to constantly work to ensure we are credible, knowledgeable, and respected within our organization, and that happens through collaboration and always doing the right thing, even when it’s not easy.
A New Role
As I take on the role of chairman of the North American Board, I am excited to use my internal audit experience to address the needs of the broader membership. Because I have been a member of the Board for the past three and a half years, and I’ve come up through the ranks, I understand the issues the Board is addressing and the strategic objectives it is trying to accomplish to enhance the member experience (see “Serving the Profession,” below). The Board’s focus this coming year is to align with IIA Headquarters, the Chapter Relations Committee, our chapters, and most importantly our members to become “One IIA” to ensure we are serving our members and stakeholders as a cohesive unit and we are responding to and meeting their needs. We have an outstanding Board and Headquarters staff to ensure we carry on The IIA’s “progress through sharing” motto. I am honored, humbled, and excited to chair the North American Board and will do everything I can to advance the profession — something all internal auditors have a responsibility to do.
Serving the Profession
My volunteer career with The IIA began more than 25 years ago when I was asked to serve on the program committee of the Northeast Ohio Chapter. I have been engaged in various capacities with our chapters for many years, serving as president and on the Board of Governors of the Central Virginia Chapter; as a district representative in the Mid-Atlantic; as a district adviser responsible for the states of Alabama, Georgia, and Florida; as chairman of the Chapter Relations Committee responsible for all chapters in the United States, Canada, and the Caribbean; and as a member of the North American Board. On the North American Board, I served two years on the Global Finance Committee and last year as senior vice chair responsible for strategy. I have definitely come up through the volunteer ranks and have a keen awareness of how we can better serve our members and our chapters from a Board perspective.
As the new chair of the North American Board, I am fully committed to continuing the Board’s efforts to serve our diverse membership in the areas of member experience, training, professional development, networking, and overall engagement in the profession. Over the past several years, the Board has invested in The IIA’s North American website, helped create the Audit Executive Center, and played an integral role in the recent launch of the American Center for Government Auditing (ACGA).
I am excited about the ACGA, as it will provide me the tools, training, benchmarking, and networking opportunities I have been looking for as a government audit professional. The Board and The IIA are committed to making the center a resource that significantly enhances services to the government sector, which has been underserved.
One of the Board’s most important strategic objectives in the coming year is our “One IIA” goal. The IIA, through its headquarters staff and volunteer leaders at all levels, will partner to be viewed as “One IIA” to effectively deliver products and services to the profession and its stakeholders. We want to make sure we meet members’ needs and provide them with exceptional value for their membership. Our intent is to define our unified brand message, taxonomy, standards, guidelines, and issues platform. We will centralize and integrate communications via IIA publications, including SmartBriefs, Career Compass, and IIA Connection.
Years ago, while attending The IIA’s Leadership Conference in my role as Chapter Relations Committee Chair, several attendees approached me and questioned the lack of diversity on the North American Board. They inquired as to how we could change the Board composition to better reflect The IIA’s membership. Over the past two years, the Board has developed a diversity strategy and outreach program that includes proactively recruiting, encouraging, and assisting in the development of a diverse cross-section of our membership in leadership roles at the committee and Board level. To that end, we have developed a “rising stars” program to engage our young professionals, a mentoring program to develop diverse candidates, succession planning programs at the chapter level to identify and recruit candidates, and an outreach program with various diversity groups and associations to recruit volunteers. We have made significant strides in our volunteer objectives related to membership involvement and committee composition. The one area in which we will still have work to do is engaging our younger professionals.
In the coming year, it is the Board’s objective to raise awareness and enhance the image of the internal audit profession with regulators, legislators, management, and boards. Two years ago, we established a North American Advocacy Committee and began committing resources for a firm in Washington, D.C., that helps us establish our visibility and presence on Capitol Hill and supports our regulatory outreach. We have four goals: 1) become a trusted adviser to relevant legislators and regulators (which is targeted to result in 50 substantive interactions in 2014); 2) add stakeholder value on collaborative activities with organizations representing key internal audit stakeholders, such as the National Association of Corporate Directors and Financial Executives International; 3) enhance online accessibility for advocacy resources, tools, and information by December 2014; and 4) develop a system to engage the chapters in building a grassroots network to support our North American advocacy objectives.
In addition to these strategies, each Board member has agreed to champion several initiatives, including: supporting and retaining members; ensuring viable training platforms exist that focus on current topics and platforms; promoting certification and recognizing members for achievements; ensuring communication is timely, relevant, and at the right level; promoting the profession to new chief audit executives; leveraging and developing programs for specific industry groups; and ensuring financial stability for The Institute.
As an IIA volunteer for the past 25 years, I have developed an outstanding knowledge base of the issues facing the profession, compiled an incredible network of resources to assist me in carrying out my professional responsibilities, and, most importantly, developed lifelong friendships with peers around the world. There is not a state, province, or country I can visit where I don’t know an IIA member. I ask that as you read this article, you consider what you can do as a volunteer to assist your chapter or fellow IIA members in advancing the profession while growing the next generation of internal audit professionals.