By Ashley Clark, Senior Audit Supervisor
Kyle Erickson, Auditor
Internal audit and investigations are the two key functions statutorily assigned to Offices of Inspector General (OIG) in Florida. Most members of the Inspector General (IG) community are actively involved in professional organizations, such as the Institute of Internal Auditors (IIA), Association of Inspectors General (AIG), and the Association of Government Accountants (AGA).
In an article published in The Journal of Government Financial Management, October 1, 2015, Dr. Matthew D. Harris, an Assistant Special Agent in Charge, US Postal Service Office of Inspector General, discusses the five traits for IG effectiveness. These five traits include: Interpersonal and communicative skills, personal independence, learning the organization, building relationships with stakeholders, and respect for the IG mission. In Dr. Harris’ research, building relationships and communication were key elements of success. These two elements are the most relevant as it relates to building relationships with the executive management team.
In an effort to determine how we can build and maintain effective trusting relationships, the Florida Chapter of Association of Inspectors General (FCAIG) hosted a panel discussion in October 2016. The panel consisted of four State of Florida agency heads, and was moderated by Florida’s Chief Inspector General, Melinda Miguel. The purpose of the discussion was to gain insight from executive level management on what practices OIG’s can utilize in order to develop and maintain trust with senior management.
During the panel discussion, three common pillars of trust emerged: integrity, communication, and reliability. Without one pillar, trust in a relationship could fail; however, with all three pillars, a firm foundation for building and maintaining trusting relationships is formed. In this article, we will discuss the three pillars and the importance of establishing a trusting relationship from the perspective of executive management.
Pillar One: Integrity
Dwight D. Eisenhower once stated, “The supreme quality for leadership is unquestionable integrity. Without it, no real success is possible…” Success is the driving force behind internal audit: success of the business or company, success for the people who serve in it, and success for the customers that benefit from it. Integrity is a fundamental component of internal audit’s mission, which according to the IIA is “to enhance and protect organizational value by providing risk-based and objective assurance, advice, and insight.” Achieving this mission is difficult if the internal audit department is lacking integrity. If integrity is lacking, the actions and recommendations of the internal audit function could be viewed as unauthentic, and the chances of success diminish. It takes time to build a reputation for integrity, but only a moment to lose it. Florida’s Agency for Persons with Disabilities (APD) Executive Director, Barbara Palmer nicely summarized the importance of integrity by stating, “The only thing we have is our integrity and reputation.”
Pillar Two: Communication
Communication was perhaps the most common point discussed by panel members. If communication is not frequent and open, reliability and integrity do not seem to matter much. Communication should be consistent and continuous to ensure agency heads receive relevant and timely information. Receiving outdated information does not allow an agency head to act swiftly or appropriately. Florida’s Department of Highway Safety and Motor Vehicles (DHSMV) Executive Director, Terry Rhodes recommended agency heads and the agency Inspector General establish a weekly or bi-weekly meeting to discuss status updates and reports. Additionally, communication should be honest and unbiased.
APD Executive Director Barbara Palmer recognized that one purpose of an internal auditor is to assist in helping an agency find deficiencies nobody knows about, and recommend practical solutions to potentially systemic problems. Florida’s Department of Management Services (DMS) Secretary, Chad Poppell followed up with an excellent point by stating, “I need to know what’s going on. Surprises create hardships. We have to communicate even though it could create tension.” Communicating information, particularly negative information, is not an easy task; but it is a task that internal auditors are called to do to help make an agency better by providing practical solutions management can implement.
Pillar Three: Reliability
Reliability is dual faceted: in one sense, it is when a person can be trusted to complete a task with minimal direction or supervision. In another sense, reliability is established when information being communicated is confirmed to be true and accurate. An internal auditor must possess the qualities of being willing and able to perform, as well as have a sense of trust in the quality of work being conducted. Unreliable work, even if it is clearly and timely communicated, does not meet the mission of progressing towards excellence. Department of Children and Families (DCF) Secretary, Mike Carroll recognized reliability as one of the most important elements of trust by stating, “The context of reports is important; the context must be right.”
Another factor of reliability is that internal auditors (in the IG Community) are functionally independent of the agency in which they work. This allows for optimum confidence that the quality of work coming from an internal audit office will be accurate, truthful, and unbiased. DMS Secretary, Chad Poppell recognized that, at times [agency head] positions can be difficult because people come to you when things do not go well. As a result of this, he depends on the internal audit activity (IG Office) to be an independent voice. Reliability is paramount in establishing a trusting relationship.
Oftentimes, Inspector General staff battle being viewed as a function that is in existence merely to point out the wrong doings of people within an agency. DCF Secretary, Mike Carroll agreed that this “function can be looked upon as a bad thing, but only by staff who are doing bad things.”
The diagram above shows the relationship between the three pillars, with trust being the optimum center point, and relationships surrounding all of the elements. If a person of great integrity communicates but is not reliable, an effective trusting relationship will not be built. If a reliable person has integrity but does not communicate, an effective trusting relationship will not be built. If a reliable person communicates but lacks integrity, an effective trusting relationship will not be built. All three pillars work together to create the foundation of trust upon which a mutually beneficial relationship is built.
Although internal audit is often times viewed as the “gotcha” function of an agency, executive management stressed the importance of the opportunity to identify potential systemic deficiencies. APD Director, Barbara Palmer offered a final word to those who work in an Office of Inspector General: “We need you, we love you, you keep us safe.”