The spring conference season is upon us and I’ll be joining the final panel of Lexis Nexis’ Corporate Governance & Compliance Conference.  The panel will be discussing Corporate Social Responsibility & Governance and will include Greg Dooley, Managing Director – Investor Services, Computershare and Dr. Leeora Black , Managing Director, Australian Centre for Corporate Social Responsibility as well as myself.

Information can be found at Lexis Nexis’ website.

I hope to see you there.

Todd

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The Leading by Learning Series is a great initiative by Trinity College in Western Australia. It aims to bring together alumni and a broad section of leaders and innovators to talk about real issues and a the future of WA.

The format is to have a speaker from outside WA deliver a keynote which draws on their particular expertise / world-view.  This aims to stimulate a some different perspectives and is followed by a discussion amongst community and local leaders – most of whom are doing amazing things.

I’m really privileged to have been asked to be this session’s provocatuer, and join an outstanding panel – Keith MacQueen from Bendigo Bank, Melodie Potts from Teach for Australia, Irina Catalini from WACOSS as well as the moderators from the Trinity team.

If you’re going to be in Perth, and have an interest in strategy and what the future holds for you as a leader, I’d encourage you to come along.

Information can be found at Trinity’s website.

I hope to see you there.

Todd

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I’ll be moderating a discussion on Embedding Risk Culture from around 11:20 on the Tuesday the 10th.

The panel will include:

• Kerry Stubbs, CEO and General Manager, Northcott Disability Services
• Jodie McKeon, Senior Operational Risk and Compliance Manager, AMP
• Vaughn Wilkinson, Group Risk Manager, Mirvac
• Graeme Alexander, Head of Compliance and Ethics, American Express

For more information, go to the Lexis Nexis website.

Discussion about risk culture is always insightful and I hope to see you there.
Todd

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The article reviews the latest benchmarking study from IIA and Protiviti of 160 heads of internal audit from around Australia and draws out three key themes of interest to those charged with oversight of internal audit and risk management.

Key points

• It is now the norm for internal audit to be independent from management. If you are not in line with the IIA’s Policy Agenda, you may be an outlier.  Given that these are simple mechanical mechanisms, we recommend benchmarking your function against these areas and taking action accordingly.
• Internal audit still struggles to demonstrate compliance with professional standards.  Given that these matters are relatively straight forward, organisations should insist that their internal audit functions and outsourced providers comply with the IIA’s International Professional Practices Framework.
• Quite rightly, strategic risk has entered the top 5 priorities for heads of internal audit, however the reality is that capabilities in this area are embryonic at best. Organisations should assess whether have this capability in-house, and if not take steps to develop it, or periodically engage professional assistance to fill this gap. The first step is to understand what strategic risk is, and this article takes some initial steps towards defining this.

Please feel free to download the article and pass it on. (Download, pdf, 3 pages, 113kB)

For more information on this publication can be found here.

Todd

Related links

Strategic risk and emerging risk capability assessment

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The good folks at Lexis-Nexis have been kind enough to invite me to be on the editorial panel of their new magazine Risk Management Today, and to have the lead article in the inaugural edition.  They’ve also been kind enough to make this article available free of charge to my clients and readers for a limited time.

The article aims to get beyond the literature and standards, and give insights on some of the key things to look for when assessing the adequacy of an organisation’s risk framework.  It is pitched at those who are not necessarily experts in risk management per se, but rely heavily on an organisation’s risk management framework.

Key points

• Despite organisations making significant investments in risk management, they still fall short in dealing with disruptive change.
• Regulatory changes seem unlikely to get to the heart of what really matters in avoiding significant destruction of shareholder value in the future.
• Seven key areas of risk management areas are discussed that investors, boards and the C-suite should be looking for.

Please feel free to download the article and pass it on.

Download the article (pdf, 3 pages, 86kB)

Also this publication is shaping up to be a very good one, and I’d encourage you to have download the inaugural issue and have a look (free download for a limited time).

Todd

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Given the major reforms in Queensland and New South Wales in the past 18 months, we will  have a focus on their changes, which are both interesting in their own right.  Queensland has moved to a principles-based approach in a range of respects, while New South Wales is implementing what I believe to be one of the most comprehensive and best thought through approaches to these matters anywhere in the world.  Both will be watched with great interest by other jurisdictions.

On the panel with me will be policy makers NSW and Queensland as well as practitioners at the audit committee and chief auditor level in both states who will be sharing their experiences and viewpoints as they implement the new policy frameworks of approach.  We’ll also be drawing comparisons from the IIA’s policy agenda which was launched by Lindsay Tanner earlier this year as well as canvassing the different jurisdictions in the room (Commonwealth, and state and local government from each state and territory in Australia, New Zealand and abroad).

Building on last year’s debate, this session will be of great interest for those charged with leading governance within government departments and organisations, or charged with policy setting — both to get a sense of where we could / should be going, as well as hearing from those who are already doing it and some of the lessons learned from these.

I’ve promised to make the session “more Jennie Brockie than Tony Jones”  so please pose a question during the session (Tuesday May 11 from 11:15am – sessions 6D & 7D) or come and say hello over the course of the ACIIA/SOPAC Conference.

Looking forward to seeing you there.

Todd

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Disclaimers and caveats in audit reports and engagement letters are often brushed over, until something goes wrong, and then can cause great tension between those providing the internal audit assurance, and those relying on their work. Rightly or wrongly, the classic “where were the auditors” line is begging to be pulled out, and is often the first response.

In my experience, issues usually arise as a result of expectations gaps around the nature of audit opinions rather than negligence, but this takes time to disentangle after the fact. The better option of course, is to get this squared away up front.

As part of my work in helping the market to get more sophisticated about the nature and level of assurance commissioned and provided, I’ll be leading an on-line masterclass for the Institute of Internal Auditors in Australia on Tuesday May 4 from 1:00pm AEST.

Through structured discussion and practical exercises, this course will take participants through a framework for providing internal audit opinions, including being clear on when to use them, how to use them, legal implications, how to navigate overlaps between different assurance standards and frameworks and an appreciation of the IIA’s official guidance in this area.

While this is targeted towards internal auditors in particular, this course will also be relevant for anyone who regularly relies on internal audit reports such as the senior finance team, C-Suite and audit committee members.

For more information and registration, please got to the Institute of Internal Auditors’ Australian website.

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After two years working with the Institute of Internal Auditors as their national Technical and Policy Director in Australia, I’ve had a lot of inquiries on why I was moving on, and what’s next.

Risk Magazine Magazine (Australia) published an interview with me this week – Davies Leaves on a High - which covers this in the context of the IIA.

Given that articles can only contain so much, for those who are interested in the full story, our media statement gives a bit more insight into how the last two years of focused effort fits into a long term program of structural change for the the internal audit profession for the betterment of directors, boards, shareholders and the general public.  This is available for download at the link below.

Media Statement – Todd Davies departure from IIA (pdf , 336kB)

For more information, please feel free to contact me directly.

Todd Davies FCA CIA FIIA(Aust) MAICD
(02) 9043  1719

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As the developed world pulls itself away from the abyss of the global financial crisis, many around the globe are breathing a sigh of relief. Having dodged a major bullet, organizations are now returning to business as usual. But if the crisis was a wake-up-call for the world, did business leaders and internal auditors pay attention or just hit the snooze alarm? What’s the next “black swan,” or significant unforeseen risk, and what should internal auditors be doing about it?

In this free feature from IIA’s global magazine, Todd summarises several key areas should be on all company watch lists for 2010 and beyond.

http://www.theiia.org/intAuditor/free-feature/2010/february/a-look-ahead-top-risks-for-2010/

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Part 1:

Part 2:

Part 3:

This video has been provided by the IIA as part of their outreach program. For more information go to www.iia.org.au.

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