The Auditee Calls the Shots
The auditee ultimately decides how to respond to a risk. Yes, we can highlight the risk in our audit report and recommend action, but the auditee calls the shots by making one of four moves regarding that risk…
1. Accept
Sometimes the auditee will decide that a risk is worth taking. Or, they simply don’t have the resources necessary to mitigate the risk, so they keep doing the activity even though it is scary.
Example: Legislation demands the auditee physically visit every nursing home in the state each year, but desk reviews and phone calls are all the auditee can afford.
2. Avoid
Maybe the auditee can stop doing the activity (or never even take on the activity!) that is generating the risk.
Example: No, the auditee won’t be buying that abandoned golf course, ‘cause it has never made a dime.
3. Reduce
Auditors love it when the auditee makes this choice because we can recommend layering on more controls to mitigate the risk.
Example: Since the auditee collects personal data on clients, the auditee agrees to enhance its cyber security to prevent hacks.
4. Share
Can the auditee contract or partner with another organization to share the risk?
Example: The auditee has no experience working with homeless children, so they partner with a local not-for-profit who does!
Want to learn more?
For more in-depth instruction, I invite you to check out the Creating a Productive Auditor & Auditee Relationship Bundle. This self-paced bundle includes two self-study guides and two video courses for a total of 14.5 hours of Yellow Book CPE credit.
The auditor needs to go above and beyond their normal ways of communicating in order to help the auditee feel safe. Because if the auditee doesn’t feel safe, the auditor won’t get the information and cooperation from the auditee that the auditor needs to complete the audit.
In this bundle of videos and self-study texts, learn ways to smooth the auditor and auditee relationship so that the auditee welcomes the auditor back year after year after year – if not with open arms with at least a comfortable resignation to the inevitable.
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