Common Mistakes New Auditors Make, and How to Fix Them

All human beings are creatures who change with their environment and circumstances. Auditors are in the unique position of watching this progress in real time. Clearing comments left by our bosses, examining last year’s work to build a foundation for this year’s work, and taking required CPE courses makes the metamorphosis from beginner to experienced auditor an unusually fast life cycle.

I began my audit career in a very different world. Enron and WorldCom were recent history, dissected at business schools and auditor conferences. The economy was humming along, and had been for a while. It was also business as usual for a certain investor in NYC… one Bernie Madoff. The Financial Crisis was in the unthinkable future. And the pandemic? That was ancient history, not a global event affecting our daily lives and work routines.

Eventually I left the competitive world of external audit and firm politics behind, and moved into an Internal Audit role. I’ve been here ever since, and learned how to provide value in different audit roles. One of the universal experiences of being an auditor is looking back on your work and taking in just how far you have come. And let me be clear, it is not a pleasant experience! Literally every auditor I know has kicked themselves trying to follow the workpapers from their first audit. It is almost as bad as reading Facebook or Twitter posts from ten years ago!

Being young and inexperienced can’t be avoided, but there are some common mistakes that can. What are some of the “tells” that give away a brand new auditor’s status? When are these just funny anecdotes, and when can our bad habits cause real damage? When do auditors hold on to these “newbie” habits, stunting their professional growth? And finally, what can new auditors do today that will project a more professional image to co-workers and auditees? Keep reading!

Working for the Sake of Working

Auditors are often workaholics, and not by choice. For many auditors, a professional firm is where our career takes root. When you are new at a firm, your role is simple: CHARGE HOURS. So, you make yourself available to work, including early mornings, late evenings, and weekends. This noble lifestyle has some weird consequences. Auditors can get competitive, and even judgmental towards one another, about hours worked, hours billed, life events missed, and other indicators of suffering

I haven’t gone grocery shopping in two weeks!

Oh, yeah? I didn’t see my kids yesterday! 

Well, I’m so busy I didn’t even watch the game!

I’m not joking. I have actually heard people say these things. I have also seen people come in early, just to take a victory lap around the office, so everyone else who came in early knows they came in early. It’s funny, but also insane.

While it’s okay to have a laugh at this behavior, the lesson is to keep these feelings and statements away from your clients. Nothing screams “I’m new at my job” more than telling anyone who will listen how much time you spend doing it. While the poor saps in your same circumstances might be impressed by how little you sleep, I can assure you, your clients are not.

I’ve been the clueless new auditor, bragging about my lack of nourishment and life devoid of fun. I’ve also been the client on the Internal Audit side who doesn’t have to do that anymore. We don’t want to hear it. It’s boring to people outside of your bubble. We prefer you be alert, fed, rested, and good at your job. That will get the job done, and you gone, faster. We prefer that you aren’t suffering, because… Well, because we aren’t monsters!

I’ve been picking on external auditors and consultants, but Internal Auditors also display this behavior. When charge hours are not the goal, you are expected to get your job done during normal working hours. Regularly working evenings, weekends, and holidays, and demanding this of staff if you are in a leadership role, can bring down team morale. Even worse, it can lead others to question why you can’t seem to get things done during business hours.

Don’t talk about your work ethic, show it. Work with a sense of purpose and urgency, get your reports out in a timely manner, keep your email inbox clean and current, etc. Every once in a while, you’ll get to flex that workaholic muscle and put in some overtime to handle an emergency or deadline. Do so happily, and with a sense of pride that you have a good job.

Dress Code Fails

When John Kaneklides and I were getting our consulting practice up and running, we had a brainstorming session. We workshopped all the things that drove us crazy about consultants and external auditors when we were managing these engagements on the client side. We wanted to spare our future patrons! One was so simple, so silly, and so common… Auditors asking us about our dress code. This happened all the time, and we knew right out the gate that we were dealing with an inexperienced team. Did I do this when I was brand new? Unfortunately, yes.

So, I have some thoughts. External auditors, please do not ask your clients what you should wear to work. I understand that at many firms the dress code is to follow the client’s dress code. This is a bad policy. It is not your client’s responsibility to communicate their company’s work aesthetic to you. You are an adult, and your dress code should be your own interpretation of acceptable work attire. When in doubt, overdress on the first day and course correct thereafter.

This brings me to Internal Auditors, who are not immune from failing to dress appropriately. Your company probably has a dress code, which you should think of as the bare minimum. This standard was put in place for workers who don’t make good decisions on their own. Auditors know as well as anyone that a policy is limited in what it can explain. If your company allows you to wear jeans to work, take care to wear well-fitting tailored jeans with nice shoes and a work appropriate top or jacket. Whether your dress code calls for casual, business casual, or business professional dress, there are some universal truths. Practice good hygiene, keep your clothes clean and pressed, and invest in quality classic pieces.

We’ve all heard the saying “dress for the job you want, not the job you have.” It’s a cliche, but it’s 100% true! Auditors are leaders, and leaders are expected to take care in how they present themselves. Do what you need to do to come in to work, or show up on Zoom, looking like you fit the part!

I’ve Got a Great Idea! Audit More Stuff!

Auditors who are new to the game are often eager to prove their worth. External auditors typically meet with Internal Auditors throughout an engagement, for many reasons. When I was on the client side, I started to notice that some external auditors, consultants, and even regulatory examiners would recommend that we… Audit more stuff!

Oh wow, great idea guys. Never occurred to us before!

Did my mind go there when I was a brand new external auditor? Yes, absolutely. This was my own immaturity and inexperience. Once you’ve been around the block, you realize that time and resources are always limited and every Internal Audit team makes hard choices. Questioning why the auditors didn’t get around to a project that would have addressed exactly what you’re thinking about at any given moment means questioning their entire audit plan.

By the time I was in a leadership position, after having this pointless discussion one time too many, I started handling myself differently. Whenever an external auditor, consultant, or examiner started going down the “why didn’t you…” path, I would set up a private meeting. I would print out the audit plan (so I could shred it afterwards), walk them through the development and allocation of hours, and let them see for themselves how much of a fine line we walk. They usually came away from this meeting with a new understanding of the hard choices auditors must make, and have more respect and trust for the audit group as a result. Would they agree with all the choices I made? No, of course not! But as a leader it was my responsibility to defend my decisions, and to help others understand the process.

Inexperienced Internal Auditors may question this process, and could benefit from an elder’s perspective. If you are new to an Internal Audit group, you probably have some opinions about your boss and the decisions they make. There is probably more going on than you know. Watch, learn, and keep an open mind. Leaders, don’t just tell your staff what to do. Teach them how the audit plan is created, ask for their feedback, and earn their buy-in.

Pretending to Understand

One of the ironies of auditing is that the longer you work at a client or company, the more questions you have! You learn exactly how much you don’t know, and this knowledge about being unknowledgeable accumulates over time. Another trait that develops as you mature is the ability to admit you don’t know something, and having the confidence to ask questions. 

New auditors often feel what is called “imposter syndrome” and make some bad choices as a result. If you don’t understand something, there are three possible reasons why. The first explanation is that you aren’t smart enough to understand. This is very unlikely. The second is that you don’t have all the information. This is very likely! The third is that there is something wrong. Please let go of any insecurities that could lead you to assume you are the problem. Approach questions and issues as though you simply don’t have all the information (yet!) and that you are trying to understand. 

If you do this work long enough, you will uncover an issue. Whether the underlying issue is an unqualified staff member making a mistake, or something more nefarious like a fraud or theft being covered up, the only way to figure this out is to be honest when something doesn’t make sense. This leads to asking more focused questions, digging deeper, and showing the person you are auditing that you won’t just go away. I encourage all auditors to be confident, ask questions, and keep searching for the truth. 

If the explanation was there all along, and someone had to walk you through it, what’s the harm in that? 

Communication Breakdowns

Auditors are one of the few professionals who must be able to communicate with people at every level of an organization. A common sign that an auditor is new, whether they hold an external or internal position, is having some difficulty communicating with others. The most common type of breakdown is when auditors are intimidated by executives. While the C-Suite deserves your respect and admiration, they are required to answer your questions, just like anyone else. Don’t be rude, but don’t simply defer to them either.

A more troubling trend I’ve witnessed is auditors speaking down to frontline employees. Your education level, position, paycheck, or any other status indicator does not give you the right to disrespect anyone! In fact, auditors can learn a lot from the tellers, cashiers, and assembly line workers that keep your company going. Be the kind of person that people seek out when there is a problem. If you’re rude or condescending to others, you are doing yourself and your audit team a disservice.

I encourage auditors everywhere to think of their auditees and interview subjects as human beings, rather than positions on an org chart.

Conclusion

I hope this post was helpful, whether you are a new auditor figuring it out, or an experienced auditor looking back. Readers, have you experienced any of these issues? What new auditor traits and tells did I miss? Leave a comment!

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