In reply to:

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I have a personality, therefore, I'm not an internal auditor

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You must really have a low opinion of internal auditors.

I've had some bad experiences relating to internal auditors that, at that time and years ago, were acting like traffic cops out to get a quota for the day. But in the final analysis, 50% of the group are more than likely hard working and helpful people, but given the original question, in my opinion, it's a field to avoid or, at best, only spend a short amount of time and move on.

As internal auditor and compliance manager, it depends on how I am treated. If I am treated fairly, as part of the team, and people are truly working to improve things, I am very much a part of their team and will offer my assistance. But on the other hand, if someone does not cooperate or is not trying, I will identify it and they can fix it themself.

I have said it before that I was previously a lender, branch manager, branch administrator, staff accountant, teller, etc so I know operations fairly well. I believe I am management's friend not their enemy. It is up to them how they choose to receive me. I understand what the people deal with everyday since I have been there.

Anyway what I am trying to say is have an open mind. Allow auditors to be part of the team. Yes we must be independent but we can add more value to the table if you let us. We are human too. and believe it or not I love people and I am a huggy person, currently I just happen to be an auditor too.

Opinions are mine not my employer

Well, mostly due to the responses here, I have submitted my application.

CAR, all the best to you in your new endeavor. In my opinion, internal auditing is more important now than ever before. Gone are the "bean counting" days of our predecessors. Internal Auditors are involved more and more in managing risk, helping achieve the goals of the organization. Auditors work to ensure that the CFO and CEO get to continue to sit in their big offices and make the decisions. Of course both Internal Auditors and Compliance types make less. That's really a no brainer. They're a cost center. Add that to the fact that banking has traditionally paid those who produce. That's the mortgage, consumer, and commercial lenders. IA and Compliance is not the most popular position in the bank. That's because we represent accountability, and the folks who swing the big sticks. As a general rule, people don't like that. If you want to be popular, go get a job as a movie star. If you want to learn the inner workings of an organization, become it's internal auditor. Study your craft well, and you'll find that it can be a step up to something bigger. You'll find that IA's and Compliance people are willing to help each other out, even from competing organizations. I enjoy the opportunities my job affords me. As an auditor, you have the opportunity to be a consultant. IMHO, a good auditor only needs to use the "big, bad wolf" tactic when he isn't getting the assistance he needs from staff. Creating an adversarial relationship only reduces your effectiveness. Well, that's all I have to say, I'm done preaching. Have a great weekend!

You sound like an auditor that I would not mind working with and perhaps my experience is not reflective of the current situation. Please see post above (from the original poster) - application is being submitted!

First, Good Luck to the original poster! If God sees it in His plans for your life, no doubt the job will be offered to you. I truly believe no matter what we do in life, we must let Him guide our decisions, then we should do our very best to make Him proud of us. And no doubt you will! This is just my personal opinion.

And Grist, thanks for your compliment, I am glad that we all help each other on Bankersonline to see things differently. Not only do we help each other with our daily "work" concerns, but so many times I have received the motivational support I need from the people that donate their time to BOL. Personally, I believe everyone throughout the organization should be recognized for the job they contribute to the organization. It takes all of us to make it work! Including the cleaning people. And since I attempt to do both audit and compliance, I see both of them as challenging experiences and they both take much brain power if I am trying to do a "good" job. But so did being a teller when I was one years ago. I try to have respect for every position.

Opinions are mine not my employer.

I was just browsing the posts on this thread and decided to chime in. First of all as stated previously both I/A and Compliance are a mind set. I have 19 yrs experience in all areas of banking and am currently in the I/A position and provide assistance in the Compliance area. Prior to moving into the audit position I was the network administrator for a period of 2 years. When I was asked to accept the I/A position I was told by another "tech" person that I would not like it because I wanted people to like me too much. However, I was ready to get away from computers and back to banking! I obviously took the position and I can honestly say that I had more people mad at me when I was in tech! Internal auditing can be very interesting. It has been the only position that has truly allowed me to apply the knowledge that I have gained in all of my years of banking, including compliance and tech. Although I do agree that there are some people placed in the audit position just to say "yes we have an auditor", if managment is committed to the true intent of the position, the individual has to know at least as much if not more than departmental mgrs to be able to evaluate the effectiveness and efficiency of controls and procedures they have implemented and to recognize unusual or suspicious activity . The key is acheiving and maintaining mutual respect with all employees. Do not come off as a "know it all", provide value-added recommendations and always keep an open mind. I believe in the teach (and learn) as you audit approach, explain and understand your position..do not dictate things that you yourself do not understand. And always try to listen and learn from others.

As for audit vs. compliance, both have challenging qualities, but I have found it is much easier to research compliance laws and regulations that I am less familiar with and obtain definitive answers. On the other hand, audit resolutions are very subjective and depend on the complexity, size and resources (people and monetary) of the organization. Most of the time there are no "stock" answers, therefore an auditor must be able to evaluate all of the above and use brain power to provide tailored recommendations that are both cost effective and efficient. Networking such as this does assist greatly with this challenge. Last, I do not believe that audit/compliance either one are cost centers. Although we do not provide tangible dollars to the bottom line, if we take our position seriously, we help mgmt avoid material losses and cmp's that might not have been avoided otherwise It is just too bad you can't prove a negative! Good luck and take pride in whatever comes your way!

Sorry to hear you've had bad experiences with IA's. I hate to see such low opinions about IA's. Frankly my popularity was worse when I was a Compliance Officer. AND, yes, believe it or not, I do have a personality, however, since my job is to work independently, I don't get too friendly with bank staff. I wish I could, but I can't. I am neither the old bean-counter type nor some big time "traffic cop" looking for my "daily quota" (whatever that means)nor do I get my kicks by looking to nail anyone. I feel that my job is to help keep the bank safe and sound. I look for the best in staff and, yes, sometimes for the worst, I note the weaknesses, I comment and make recommendations. I beleive that my experience is helpful to Sr. Management, so when possible I also help train staff, particularly the line managers. I have people from the CEO to the Teller ask for my help and glady give it when I can. I have helped train supervisors, organize departments and assisted management in developing written internal controls. My job is not just to sit on a-- and look for screw ups, I feel that I am a vital part to our organization, and if my knowledge and experience can be utilized to ensure that the assets of the bank are protected, I hope I can share in anyway that I can without getting too deeply involved in the Management of the bank. Perhaps if people took the recommendations less personal and more as a means for ensuring that a problem does not hurt the bank in anyway it would be less painful, that is unless the findings are/were serious enough to open some eyes. The Auditors may be considered by some CFO-types as non-income producing, however if we do our jobs well, we do help save banks big bucks in fines, fraud, legal fees, and more. Our recommendations, and being internal, many many times help the bank save at the bottom line. So although we don't get out and sell and get the big pats on the back including the big dollars (like the CFO-types), we do help. AND even though not noted by some people, we DO especially help the bottom line. As far as salary is concerned, I guess that depends on a lot of things. The better you are, the better the income. Mine is OK, however, as with any job, YES, I WANT MORE.

First, use paragraphs next time. Second, while my experience has not been good, I've occasionally had a good experience as well. The bottomline is the auditing approach.

Sorry that my writing here is not structuarly correct to suit you...just simply trying to save space. You know us audit-types,we never stop. AND you are absolutely right, in end the approach IS important (by all involved). All in all, my best to the original poster. Whatever career path you choose, keep in mind that it's what you make of it that counts.

Grist what I don't understand in your comment is your statement that compliance vs. i/a is more important. In your position, other than losses from a cmp, how does compliance even reconcile with the CFO position? I know compliance officers that know almost nothing about bank accounting issues, FASB, or SFAS (and don't really need to) Wouldn't your dependence be greater on that of a knowledgeable auditor and less on the compliance officer

Was your bad experience with an auditor that had the ID 10T syndrome or were you just difficult to deal with so they got an attitude?

Let us know if you get the job!

Grist, the tone of your posts here is coming off as very condescending to Internal Auditors. I don't know if that is your intention or not, but that's the way they read to me. You've offered a very one-sided perspective on the career field of internal audit.

As someone who has spent many years in both internal audit and compliance, I feel qualified to speak to this issue. I feel both areas have the potential to be very rewarding endeavors. And I've found that my compensation has been pretty consistent in both areas and very satisfactory to me.

To the original poster: While there are a lot of similarities between the professions, there are some differences too. Each can be rewarding in its own way and both I find to be very intellectually stimulating and challenging. Both areas provide you with opportunities to address new issues every day. Both areas allow you to contact broad areas of your institution and explore the work that is done in those areas, giving you a breadth of experience unmatched in almost any other specialization. However, I've found that both areas are somewhat stigmatized when it comes to a perception that you might be over-specialized. I've not had a hard time at finding opportunity for career advancement within the profession, but have found it difficult to break out of the profession into a higher level of management within the bank.

I started out in internal audit, then moved to a much smaller shop where I was both the internal audit director and the compliance officer. Did that at two different locations, then finally came to the point where I had to choose between the two for an opportunity presenting itself to me - the bank was recruiting me for either position but both were separate positions. I chose compliance, not because I liked it any better or worse, but rather because I saw the field as less crowded with talented professionals and felt that would give me more security and longevity options. Ultimately, though, it came full circle, and I wound up supervising both the Audit function and Compliance function at that institution after a few years. Then we were acquired and I assumed my current responsibilities for just compliance again. After 16 years I'm a Senior Vice President in a $7 billion bank with responsibilities for a compliance function that covers three separate states, so all in all my career path has not been that shabby even blackened the way it was with the level of internal audit time I spent.

If you decide to go the internal audit route, I would encourage you to contact your local chapter of the Institute of Internal Auditors . They can offer some great training courses and resource material. Also, I would suggest you contact the external auditing firm for your bank and ask them for some suggestions. They'll also be able to provide you with some good resources. I wish you success whichever direction you choose to follow.

First, regulatory concerns (safety, soundness, compliance) also have the highest level of concern at the CEO and board level. What is most important to the CEO and board gets my attention, big time. Therefore, although compliance issues do not normally produce losses, the possibility of potential fines, etc. along with putting the CEO and board members through an exit interview with regulatory examiners that is critical of the CEO and board is to be avoided at all costs.

Secondly, internal auditing in a new bank setting (my current setting) is non-existent, in that I either personally complete tasks or seasoned bankers have been employed to perform tasks, so although documentation is always being developed, the staff goes with experience and logic until: (1) volume needs to be supported by documentation and: (2) auditing of compliance with documentation. An outside CPA firm does some internal auditing, but only as it relates to financial issues. With that said, although no pure auditing tasks are being completed, certificates, review of large items, kite suspects, and a host of important tasks are completed each day by operating personnel – it’s just that there is no one, except for me occasionally, taking a second look.

So yes, compliance is more important, to me, than internal auditing in this setting.

As for your last point, I welcome auditors and examiners at all levels. It can be a learning experience, but some internal auditors have an agenda that is not aligned with logic and the goals of the institution.

I have a position, I stated that position, now you've posted your position - is life not wonderful!

I'll try to be more humble next time, but that is a real hard thing to do.

Good luck on your new job... I plan to truck ahead also. All others be prepared for a lot of questions

Thank you J! Grist, cutting you some slack since you're in a de novo setting..try not to stereotype next time. I have seen compliance officers who also do not keep in mind the logic and direction of the bank when making recommendations to ensure compliance. It is not the position, it is the individual in the position. Some people see black and white and some see several colors. I have found to be a successful auditor there are times when both are beneficial. Good Luck with your new institution, and as it grows I am sure you will find internal control/risk mgmt to be of as much concern to regulators and your board as compliance!

Don't cut me slack, idioms are not required in this setting.

In one of the banks I worked for, I came on board in response to a Cease and Desist Order the bank had been put under by the OTS - not for regulatory violations but because of a lack of internal control and an ineffective internal audit function. I can guarantee you that internal controls and internal audit had the attention and focus of that bank's CEO and Board, big time. So just because you have not personally experienced it doesn't mean it isn't so. My message to Kevin is that there are many financial institutions where internal audit is looked at as a very valuable piece of the bank management equation. It keeps them from becoming the next Enron or WorldCom.

What I've done is play the role of devils’ advocate on this thread to see if a thorough response could be gathered from posters. It worked!

Well, you had me going. I did think it seemed out of character for what I know of your posts on other topics for you to be so far on the extreme edge on this issue. But I guess I just didn't pick up on the fact that you were yanking our collective chain a little bit. Thanks then for leading a very thorough discussion of the benefits of internal audit.

Phew, you certainly yanked my chain. I am still steaming. However it was a good discussion and I hope the original poster benefited from it.

Thanks for opening the discussion, it worked. (paragraph?!?!?)

How about a shift in direction for this thread.

I have submitted my packet for the IA position, and I like to come up with strategic directions for the IA department. (with me at its head of course ). I'm sure you all would have some excellent ideas and experiences that I can draw from.

I'd like to make the IA department more of a benefit for the company, beyond just "policing". Is it common or even realistic to become the "go to guys" for Managments/BoD questions on where inefficiency and shortfall occur?, or is IA strictly oversight?

-Kevin

In my opinion one of the main objectives of I/A is evaluation of policy and procedure to identify "inefficiencies and shortfalls" and assist in preventing circumstances from occuring, reporting to mgmt when weakness, etc are found and providing recommendations to correct/improve. I/A should be proactive vs. reactive to be most effective and beneficial to the organization .

So many times mgmt wants to depend on audit to find/identify "problems" after they have occurred and then wants to evaluate what went wrong..Instead, audit should evaluate the current control environment and perform tests and reviews to make sure policy/procedures are the most effective to achieve it's objective and, of equal importance, that efficiency is maintained.
Simplified example, file maintenace review should not be performed by I/A..I/A should look at how file maintenance is monitored and determine, through periodic random testing, whether that procedure is effective and performed in the most efficient way. Sometimes, only by chance, would audit identify "suspicious activity" by recognition of certain red flags. In other words, your primary goal should not be for you to find fraud, embezzlement, etc., but, to evaluate procedures/controls to determine if they are effective in first preventing an occurence and second identifying an occurence in a timely manner.