The “Oracle” Reviews – A New Role for Audit and Risk Functions

Audit and risk reports are very good at telling their audiences what is wrong and how to fix it.

What they don’t do is to act as an oracle whereby interested stakeholders can go to a central place to understand an area of a business.

Some would argue that that is not the role of an audit or a risk function.

The United Kingdom National Audit Office disagrees.

The NAO publishes 17 separate reports covering its work on each major United Kingdom government department.

As their website explains:

This guide is designed to provide a quick and accessible overview of the Department and focus in particular on where we believe the Department’s performance could be improved, using examples from our published work. They cover the department’s responsibilities and how it spends its money; financial management; reported performance and issues identified in NAO reports.

The benefits of applying this approach in our organisations are considerable.

McLeod Governance can envisage a day whereby the audit and risk functions are collectively asked by their Board and Senior Management to be the annual authors of such studies.

The value that both constituencies would get from such a codified look at how they are structured, what they are doing well and what can be improved and enshrining a case study for perpetuity should not be underestimated.

Not only should audit and risk teams be producing such an overview but – more importantly – their stakeholders should be demanding it.

Our only suggestion for improving this approach is we are now past the point where such reviews should be produced in a static document such as the attached report.  Reviews such as this need to be dynamic, online and periodically updated.

The consumer of this information needs to access it in the manner that he / she wants to absorb it – not how the NAO wants to present it.

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