INTERNAL AUDIT IN A PANDEMIC

Even as we, as our organizations’ principal experts on Risk Management, digest the flood of information from the media and government on this unplanned risk and evaluate its impact on our friends and family, we are also beginning to process its impact on our organizations. We are assessing how best to be a valuable partner to the Board and executive management at a time like this. We at Audit Prodigy believe that the fundamentals remain the same:

  • Which parts of the business is most likely impacted?
  • What is the timeline and impact on fundamental objectives – liquidity?
  • How prepared are we? What are our policies and plans?
  • How well and for how long our preparedness would hold?
  • Ultimately, where do we prioritize our efforts and resources?

If you peel the onion one layer, some of the follow-up questions are:

  • What is our process for developing a fast, but considered consensus around the above questions? Can we put some objective data around these views?
  • How good are our process to quickly monitor (KPIs) and report on mitigation actions?
  • Do we need real-time sign-offs to evidence policy execution in critical areas?
  • Can we reprogram our processes to minimize face-to-face contact, work remotely, yet get our jobs done?
  • How can we keep our teams together – be clear about what all of us are supposed to do? Can we quickly find resource capacity to flex around unplanned projects?
  • Based on our organizational experience and risk management expertise, can we quickly put some risks and opportunities on table? Some examples are:
  • Liquidity: AR / AP restructuring, securing credit cushion / restructuring covenants, refinancing capital purchases, reprioritize deliveries based on payment terms, more detailed, frequent cash forecasting etc.
  • Risk transference opportunities:  Force Majeure, Liquidated damages limits
    • Supply Chain interruptions and likely price hikes and impact on PPV assumptions
    • Revenue and EBITDA forecast errors due to delivery delays, resource unavailability etc.
    • Legal and reputation risk due to poor communication and execution of policy
    • IT Security risks with expanded remote work
    • Third-party (Vendors) Risks – how are they mitigating them? Impact on our company.
    • Contingency planning – reserve resources / inventory / shipping plans / hedging
    • Risks to any ongoing M&A, investment plans / assumptions
    • Collaboration opportunities with erstwhile competitors
    • Targeted opportunities to seize – buyout competition and inventory, prepared to enter new markets, new / refine products, acquire top flight resources etc.

We at Audit Prodigy can help with our exceptionally easy and versatile SaaS tool set:

  • ERM:  Assess and Heat-map risks in five dimensions, in real-time across the org
  • Certs & Surveys: Monitor and confirm execution in critical areas, in real time
  • Collaboration:  Keep teams together, address issues and deliver projects collaboratively in real time – with minimal face-to-face contact
  • PBCs: Ensure cloud-based document flow (request, receive and store) across the org
  • Forms: Create new forms on the fly and distribute across the org

Additional Resources:

https://iaonline.theiia.org/blogs/chambers/2020/Pages/In-the-Face-of-the-Coronavirus-Internal-Auditors-Must-Do-More-Than-Don-Masks.aspx

https://global.theiia.org/knowledge/Public%20Documents/IIA-Bulletin-Rethinking-Preparedness-Pandemics-and-Cybersecurity.pdf

https://www.bdo.com/insights/business-financial-advisory/risk-advisory/novel-coronavirus-(covid-19)-impact-and-risk-respo

Learn more at auditprodigy.com

Contact our CEO at ravi@auditprodigy.com | Denver, CO

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