I’ve said the same thing many times over the years, yet I cringe when I hear someone say that audits shouldn’t have birthdays. Big findings take time, and arbitrary limits will exclude audit topics with major benefits for the public. Nature agrees: Complex or big creatures require longer gestations, up to seventeen months for some whales.
Don’t get me wrong, some performance audits should only take five months from the first team meeting until the audit report is released. And some audits need sixteen months to complete. The duration of the audit should be related to its scope and objective. Deciding to test an internal control at an agency that you’ve audited before might be done in less than four months because the scope and objective are very clear. These audits are important, but the public is unlikely to realize large benefits. Choosing a topic that potentially improves services directly received by the public is quite different. It may require auditors to tackle complex findings that encompass multiple agencies, and take sixteen months to complete.
We want a solid return on the public’s investment in our office. Small topics and small audits are safe bets because the audit costs and risks are smaller. Complex topics that improve agency outcomes for the public are almost always costlier audits with larger risks. I’ve written before that audit risk is only one factor to consider, and that a good auditor also needs to factor in the audit benefit.
The decision on the audit topic should only be made with a sound estimate of audit hours or cost. In addition, auditors should ensure that an estimated five-month audit doesn’t take ten months, or a ten-month estimate doesn’t become a twenty-month reality. The causes for blown audit schedules are many, but some have solutions.
So, understanding the root causes of long audits can help us minimize their duration. Over the years I have heard many stories about the reasons that audits were untimely. I put them in five broad categories:
A complex finding can justify more time
Sometimes you encounter an organization that is barely coping with its responsibilities and you find many service problems. Or you may see indications that poor staffing decisions by agency managers are wasting money and degrading services. You could find an organization that is rich in data but doesn’t use it to manage its costly operations.
Tackling one of these topics will add audit hours. Simply put: are you willing to gamble extra resources to deliver big results?
Returning to our Lewis and Clark metaphor, the team is exploring an unknown territory: they need to learn the language of the topic area, learn the parts of the organization and their interactions with other parts and the public, and assess the culture and adaptability of the organization. In contrast, controls and written procedures are like the Oregon Trail: a territory that has already been mapped out for auditors to trace.
It may sound counterintuitive, but if auditors want to save time on complex findings, they need to frontload additional work. In the section “For Best Results, Begin With Scoping,” I went into the importance of a broad preliminary survey, or scoping, but it bears repeating: this practice is more likely to expose the team to problems and possible audit strategies.
During this phase the team should gather “potential findings” in a quick manner, noting the general types of evidence for the key elements of condition, criteria, and effect. With that list of potential findings, the team and audit leadership can consider the benefits and feasibility of tackling any big effect findings. There will be fewer dead-ends and surprises. Depending upon the agency being audited, the team may need four to eight weeks of scoping.
(There was a popular management book years ago, called In Search of Excellence. It promoted best practices strategies for executives. I’ve often joked that the book for auditors should be In Search of Mediocrity, to help them focus on methods to spot weaknesses in program delivery where an audit could make a difference.)
Knowing the potential finding and its elements can save many audit hours later. A more specific topic allows for a more detailed and certain fieldwork plan. If the team is uncertain about criteria or data availability, it’s not too late to ensure a sound plan by exploring that issue with a bit more scoping.
Better knowledge of the potential finding also reduces the likelihood of surprises once fieldwork begins. The best planning can’t always anticipate missing or unreliable data, a commonly encountered problem. The team needs to be nimble and revise its plan and audit message to mitigate that problem. Sampling may be necessary to illustrate the condition, for example. Alternately, if the missing data was intended to identify the cause, it may not be a fatal weakness. Auditors can suggest causes based on interviews, or note that some data is missing, but available data indicates areas for the agency to consider. Rewording the finding could resolve the issue.
Government Auditing Standards can double the amount of work required
Yes, we must follow Standards, but they require many more hours than we would need to reach the same recommendations without all the documentation of process, evidence, supervision, quality control, and other specified tasks. It’s usually the first reason I give for why audits take so long.
There are sound reasons for the Standards. The masonry of evidence is the foundation of an audit, and triple checking it all will ensure our lasting credibility. The worst thing an auditor can do is to issue an audit that pushes an agency in the wrong direction, to waste public resources on the wrong recommendation, or on a nonexistent problem. I’ve seen consultant reports lacking such a foundation, which does the agency no good.
As the Standards expand (and they have grown substantially over the decades) we must look for audit methods that are lean but still meet the requirements. Serving on a peer review can offer participants a chance to learn about shortcuts and efficiencies used by other audit offices to comply with the Standards. Of course, you should also look inward—excessive meetings, valueless workpaper reviews, delays in feedback and slow decision-making can all be fixes.
Establishing a consensus in the office about evidence sufficiency can also reduce fieldwork and avoid gathering superfluous evidence. If staff auditors are gathering extra evidence to satisfy a single stickler in the office, then training and discussion can clarify the expectations for sufficiency.
Audit teams can struggle to develop a compelling finding
It’s always an uncomfortable truth that audit teams are sometimes out of their depth. We’re asking frontline staff to outmanage the agency’s managers, and sometimes they lack the experience to see the problems and the right solutions. Again, a scoping phase can allow the team to sharpen their finding and workplan with extra office guidance. Audit managers should also examine hiring profiles and training regimens to get capable new hires up and over the high learning curve.
Sometimes a top-notch simply can’t find any worthwhile findings in an agency. Maybe the leadership studied continuous improvement and applied the lessons. An objective and prudent auditor should withdraw, because there are likely to be more worthwhile audits to be done elsewhere. A brief memo to the agency at the end of scoping can explain what was examined, that no significant issues were identified, and that audit resources would be better spent elsewhere.
Mixed audit risk-tolerance among the team and management may send the team in different directions. Team dysfunction can contribute to slow audits. Interpersonal conflicts can simmer beneath team activities. Work distractions or split responsibilities can kill the momentum a team needs to complete an audit. Team members and managers need to be alert to these kinds of problems and most importantly, be willing to intervene and resolve them.
Writing and editing can become an endless loop
I went over my strategies for improving auditors’ writing in the section “Writing A Story to Engage the Public.” To reiterate a couple hard truths: most people we hire to be auditors can’t write well, at all; or edit. As a result, audit drafts begin ugly and don’t improve much.
We grew up writing for teachers and professors who were paid to read our work. They had little interest in our narrative style, or appeal to a general reader. Their biggest priority was ensuring we understood the subject matter. Unless we were majoring in writing or journalism, our dissertations were meant to be inscrutable because that’s how a successful academic writes. For most of us, engaging narrative wasn’t in the lesson plan.
And nothing is more dispiriting than an endless gauntlet of edits by bosses who each think they are improving the narrative before passing it on; then, after others have whittled and puttied, want to have another go at it. I was guilty of this, and I’m still sorry about it now.
There are several ways we can reduce the writing-editing gauntlet. The most difficult is teaching auditors to write well, and quickly. First, it will take a long time and much practice to be a good writer. Second, the audit process creates its own challenges. Our workpapers are a gathering of facts, and really just fragments of a story that can be complex and difficult to tell simply. It’s like describing the dromedary camel (gestation fifteen months). Gerbils would probably be easier (nineteen days).
One shortcut is to shape the summary into a beautiful little silk purse and tolerate mediocre writing in the body of the report (and you know that idiom). Most leaders and readers don’t get past the summary, and the agency personnel will read and understand the body of the report, despite some awkward phrases.
The best solution is to shorten the editing cycle. Count the editors and the dates and days each took to make their contributions. Compare the days it took each editor and then look at the value of the edits. If they are just cosmetic or trivial and took four working days, then set some rules about turnaround. That’s teaching the editors to edit fast and well, which sometimes means not at all.
Unless the first draft was a disaster, one look by a manager should be sufficient. If you get disastrous first drafts, lock the team and managers in a room before writing resumes. Develop a detailed audit message that everyone accepts, then stick to that script. Management leadership is best spent on matters other than wordsmithing. (This is my atonement for past overediting.)
External factors can slow audit progress
Many of these factors are outside the auditors’ control and require patience, diplomacy, assertiveness, or nimble actions to address.
Auditors may encounter agency resistance, stalling, or apathetic responses. Upper management needs to engage with the agency, and perhaps with the elected leadership to resolve these delays.
Audit staff turnover can also set an audit back. Losing a team member with a good grasp of the findings can damage report-writing. Keeping your audit staff feeling fulfilled and happy with their workplace can reduce attrition. (That’s so easy to say…)
Lawyers may ask the auditors to hold off because of an investigation, sparked by the audit or other activities. If an agency head departs during the audit completion, the team may need to give the new or interim director additional time to prepare a response.
Try streamlining your work processes
If your audits seem to be taking too long to get out the door, they probably are. Auditors should periodically turn their analytical tools back on themselves to ensure that they are delivering the best value for the public’s investment in them.
I developed a flowchart of our audit process, identifying the steps and roles of each person. Each step was a sheet of paper and we covered a wall with about sixty-five different steps. We were able to see the places where we needed to rethink some of our steps and reassign roles.
Set some milestones, track the hours, and watch the process. Set time limits on the scoping phase so the team must scramble, but give more time if circumstances require. Examine the fieldwork plan for possible shortcuts. Avoid unnecessary team meetings but call one if they seem to be struggling in fieldwork.
Look at the changes to drafts and the time it took, then judge the added value. As a manager, I learned to draft reports early to get the big issues. I would read the entire team draft but put most of my efforts into the audit summary and section headings. Three-quarters of readers probably don’t get past the summary, and a good audit will tell its story in the progression of headings. If the body of a twenty-page audit is factually correct, I could accept a few awkward sentences or disorganized paragraphs. I restrained myself from getting involved later because others were paying attention to the details. That was another frustration, with everyone taking a few days for one more look at a draft, and making minimal changes, delaying release by days and days. It seemed like everyone wanted the last word.
After surveying our auditors and asking where the delays occurred, we found that our quality assurance process seemed to be a bottleneck. Make sure your office has a consensus, or at least a common understanding, of sufficient evidence so teams are not overdoing their gathering.
We always need to advocate for a streamlining approach during our audits. Ken Miller, who spoke at our San Francisco annual ALGA conference, had a great Governing column called “A Broken Record” about the misguided notion that people are the problem when it’s really the systems that are broken. I think we can add immense value if we point out overly complex procedures in ourselves in in other agencies. Approaches like Lean or Six Sigma can help, but understanding what’s happening on the front lines is often most valuable.
Expand your capacity
Auditors should be able to spot the most serious problems in an agency, but they don’t always have the best tools to address them. Consider using experts under contract to help expand your toolkit. Advisory services can be less expensive than the hours spent by team members; these services can also give them a quick start on potential findings. Observations conducted by experts will point out any ways that agencies can better achieve results. Over the years we’ve incorporated the work of specialists such as paving engineers, bond counsels, and police investigators as part of our audit efforts.
Send your auditors to training that doesn’t have “audit” in the title. There’s a wealth of knowledge that can expand the awareness and skills of auditors. Some staff are always clamoring for new software to expand audit horizons. The more tools an office has, the more quickly it can answer those difficult questions that officials and the public are asking.
