Consulting Parlour

The rapid changes in internal audit methodologies including the function itself completely off track the middle east in different circuit. What I perceive the major bottlenecks could be are-

Audit Practice- the current audit practice though differs from the horrible practices followed in earlier regime, yet a long way to go to substantiate the hard-core definition of internal auditing. The paradigm shift in internal audit connotation towards management consulting really put the internal auditors on rocking knowledge boat where you are open to some sharp teethed management sharks desperately waiting when the engine is going to be stopped.
The current audit practices lack clarity on:
Audit integrated consulting- its often said if you can not hire the high ranked management consulting firms then most of the times internal audit plays formidable role of identifying management consulting innovations and best practices to large extent. Faultfinding and neat picking connotation are gone by, one has to embrace the new age. Notable improvement areas will be credit rating system, supply chain management, customer relationship management to name a few.
Surprise checks- this is considered as one of the subsidiary tool of famous tool examination. Often it results in lucrative outcomes. But frequent exercises of the tool make it a redundant and superfluous activity. Currently for surprise checks exercises the cost of control completely outclass the expected benefits. Its needless to state that when cost of control is on higher side then it is required to be modified or amended.
Internal control - An internal control activity is analysed from different angles like cross check, review, authorisation/approval and pre defined limits set for a control. If worth of USD 10 purchase has to go with a bunch of commercial procedures then benefits of a practice will never accrue to the company. Before putting a practice in place the volume needs to be looked into. Small process activities are addressed through entity wide controls eg. Small amendment in item code request form is even authorised by unit heads. One can expect the entity level involvement and its cost! Largely documenting controls on the lines of SARBOX reveals at least 60% deficiency. From the top everything looks rosy, online controls are in bits and pieces-not integrated to large extent, paper generation is highly excessive, e-authorisation is a distant possibility. Further we are fortunate that some solid individual supervision from sharp unit heads have mitigated the shortcomings to large extent.
Standard Operating Procedures- or often referred as SOP, this is one of the most accurate way of describing the activities of any division whether its profit centre, cost centre or support function. I do agree that preparing a SOP and more equitably up keeping it requires lot of resources and manpower. Nevertheless a definite needs to enhance activity management at a macro and micro level.

Transformations and subsequent change management- its better to have one bird in hand rather having two birds in bush. Fair enough, but somebody has to identify two birds in bush first so as to make a legitimate comparison and sit back happily! Identifying the best practices and cross-fertilise into mainstream should always remain in an open end and encouraging.
Transparency and lifting the veil out of opaque integrated system- It is clearly visible that many of the datas, records, information’s are not available to internal audit department. The systems department who got all this doesn’t understand the functional reality of the business process. A more cohesive and one-way approach will result in identifying better practices.
Documentation- If Sarbanes Oxley throws GBs of documentation yet it defined a model to concrete on a foolproof internal control system. We mean documentation as hard copy and garbage’s of pile paper. Cabbage and garbage do not differ if not understood in English way!
The power of consulting- Frankly speaking the Herculean effort required for implementing a CRM or any other business management fad model is mind boggling and catastrophic. It includes some intangible brainstorming, acumen of entrepreneurs, needless to say involvement of some multi-functional brainy characters. Sitting at micro level a middle agent like me it sound too much of optimism before proving the fads. But I strongly sense strategy engine once in while should be given to patriarch of management gurus or the biggest innovator of practices i.e. the management consultants for routine checking. It will enable us at least to know where do we stand?
Absence of management consulting units in the region, outsourcing of education system testify that internal audit practice have to go long way in attaining knowledge wisdom.