In light of a compliance issue raised by the audit committee, a chief auditor agrees to collaborate with the CFO on continuous auditing and monitoring efforts.

Charlie Wilson, chief audit executive for Ranger Communications, finds himself in a difficult situation. Although he was hoping to move his audit department in a more progressive, consultative direction, the company’s audit committee doesn’t seem ready to support a plan that places lower priority on regulatory and compliance risks (see Finding the Right Balance [link to be added]). As Charlie discussed his risk-based audit plans for the coming year during a meeting with the committee members, they questioned whether there was enough attention focused on basic compliance auditing. “We understand that the compliance results for last year were positive,” the committee chair said, “and you’ve factored that into your risk assessment for next year — but what if significant compliance lapses occur? How will those be detected before it’s too late?”