Report from GAM Number 3 - Do Not Ask for Whom the Pendulum Swings

 

I had an interesting conversation on Twitter yesterday. I was watching the excellent presentation by the group from Cox Enterprises. They were explaining how they had completely transformed their audit department over the last couple of years. (Some really good information and, if you happen to run into any of them, snag them and make them share. You will learn from their experiences.)
 
I've been sending out tweets about things that have come up during the sessions. Nothing necessarily brilliant, but bon mots I thought worth sharing. One of the transformations Cox Auditing made was to move away from a primary focus on financial audits. Based on part of their discussion I tweeted out "If you are focused on financial, you are in need of a change." As I say, not earth-shattering brilliance, but a solid point worth remembering to ensure your audit work has the appropriate breadth of focus.
 
I got a reply "This statement is 20 years old."
 
I replied "I agree the statement is 20 years old.  But you'd be amazed how many shops are still working in 20 years ago."
 
There was another reply that, to my way of thinking missed the point, so I just gave up on the dialogue.
 
You see, this is the point. As much as we would like to think the entire profession is moving lockstep ahead into a great big beautiful tomorrow, there are still a lot of stragglers. For example, here was Cox (a very large organization – look them up if you don't believe me) who, as recently as two years ago, was doing nothing but financial audits.
 
An approach that, according to the Tweeter, is 20 years out of date and, apparently, not worth mentioning. (And, at this point, I'll go a little off topic. I may have taken their Tweet in the wrong spirit. If so, I apologize. But that points to the limitations of communication at 140 characters at a time. A discussion for another time.)
 
And here is the other point: Pendulums swing. For every Cox Enterprises that finds their way to the top, there is another shop – one previously considered to be cutting edge – which, because of changes in management, experience, personnel, mindset, risk tolerance, world fears, etc. burrow their way back to the bottom of the heap.
 
And that is the reason that some of the most fundamental concepts need to be revisited. That is the reason we have to remind ourselves of how we got where we are.
 
That is why we have to be reminded that we can't be doing only financial audits.
 
Pendulums swing. And, if you are willing to take an honest look at your department, you will find it has swung also. And that honest look is important, because you need to recognize which way the pendulum is swinging in order to ensure you aren't heading the wrong direction.
 
Do not assume fundamentals are known, do not throw stones, and do not point out the speck of pendulum in your brother's eye until you've addressed the log in your own.
 
(These mixed metaphors brought to you by "The Foundation for Why Didn't I Pay Closer Attention to My English Teacher".)

Posted on Mar 19, 2013 by Mike Jacka

Share This Article:    

Leave a Reply