Conference Close

The conference closed extending thanks and gratitude to Anton van Wyke, Chair of the conference and his team for hours and hours of hard work and dedication that started years previously.

The IIA South Africa did a great job of showcasing there city, their professional community and their ability to greet people in a warm, inviting and friendly way. They also showcased that they do know how to put on a good party.

There are always elements of the international conference that, in hindsight, you would do differently and the host committee along with the international conference committee will discuss, but overall it was a great event.

I expect there will be some discussion of particular key note and session speakers, perhaps some logistic elements, etc., yet overall they should enjoy the strong compliments for their conferences success.

Lessons from the Future

The closing sessions of the conference included a highlight key note address presented by Anton Musgrave, Director of Futureworld, www.futureworld.org

Mr. Musgrave's past to future insights had a real impact on the audience. His messages regarding evolution from silent to boomer to gen x/y/millenial and the related impacts brought out very powerful anticipated change and evolution to come in culture, technology and business. Respecting the challenges of the depth of content he shared in his session, highlighted examples point out that there is a current capability to develop body parts using ink jet printer technology. His taped interview lab practitioner interviews really hit a "nerve" with the attendees. That alone was a powerful message; however, he ofcourse went mush broader as regards impacts.

Considering the value of Encyclopedia Brittanica today versus google, the present day applications of second life in selected business communities for recruiting and reward and the overall recognition that relationships versus organization affiliation is the futureworld direction of our global marketplace. I encourage you to visit his web site and read some of the range of information available.

Business Integrity

Dr. Khotso Mokhele, ArcelorMittal South Africa Chair provided a keynote yesterday providing his personal insights into the current economic crisis, including thought-provoking challenges to the audience. His comments included challenges as to whether the current circumstances indicate there may be flaws to maintaining a free market economic system.

His subtly controversial comments alluded to the flaws specific to the economic benefits of the few "Wall Street" and executive management personalities when companies do well and the significant broad population negative impact to the many when companies do poorly.

His talk was successful in it's soft controversy. It had people talking. However, what it didn't address was the not to be neglected transparency the free market system includes. As financial, operational and technology control professionals we internal auditors know there are many market economies which don't include the level of financial transparency that ultimately exposed the weaknesses and teaching tools the free market system is currently experiencing.

Day 3-Final Day

The South Africans definitely know how to throw a party. Last evening was the gala event traditionally held the evening prior to the final day of the conference. And what a gala it was, lots of great music and lots of dancing. Those of you that were there know and should also know that I have pictures :-) I think everyone had a great time and thank you South African IIA Chapter for putting together a great conference and a great gala event along with the sponsor organizations.

Boardroom Challenges

Nigel Payne, Former Big 4 Partner and current leader of his own professional board member consulting practice provided insights into the challenges, pressures and expectations of being a board member, key charactersics in the makeup of effective board structures and processes which can contribute to appropriate board organizational impact.

Nigel's extensive board audit and risk committee leadership experience uniquely qualifies his perspective.

Nigel's comments highlighted selected elements of board development and operation. They included:

• Board structure, selection process
• Induction practices
• Formalize expectations
• Competence assessed, than independence-industry knowledge
• Chair calibre
• Board dynamics-team that can challenge each other
• Ethical Tone at the top

Further highlighted were elements specifically applicable to internal audit:

• Know who is your primary client
• Independent, objective and competent
• Risk based approach to the role
• Distinguish responsibilities related to assurance versus consulting
• Give consideration to the issuance of a formal opinion on governance, risk management and controls
• Address how audit reports are structured; short, crisp, clear, helpful
• When to in-house, out-source or co-source

Paraphrasing Nigel's final comments he asked the audience to ask "Why are so few internal auditors on boards?"

Boardroom Challenges

A panel session was held this morning including experienced and credentialed forensic, consulting and legal leaders from the local Johannesburg community. The session provided some insights into challenges the audit committee, executive management and the external auditors can face when confronted by entity level whistleblower submissions. The approach to this discussion was stimulated by a multi-part case presented using the medium of a well-acted movie, followed by commentary by the panelists.

Some of the outcomes of this discussion highlighted fraud prevention characteristics all organizations should consider, including, but not necessarily limited to:

• Chief Compliance Officer
• Whistleblowing procedure
• Change Tone at the Top/bonus scheme
• Ethics training
• IA function established
• Improved internal controls
• Fraud response plan

Positioning Internal Audit as a Strategic Asset

Kathryn McLay, Woolworths Limited CAE and IIA Australia Chairperson shared her experience working with the Audit Committee, her management and her team in shifting the internal audit function at Woolworths Limited. Woolworths has 3000 food, grocery, liquor, petrol, general merchandise and consumer electronics retail stores, 180,900 employees and $43 billion in sales.

Highlights included changing the perception through the approach to the responsibilities of the internal audit function:

• The way the function communicates it's issues both through the verbal and written content shared with management and the board; telling the story versus limiting content to bulleted, control point based narrowly focused content
• Evaluating the way the team asks questions, approaches the work and considers the business implications of the reviews they are performing
• Mentoring the team to ensure they are comfortable with new communication and delivery approaches being introduced
• Identifying and seeking business acumen, inquisitiveness, humility, effective communication and a practical approach to roles and responsibilities in all the members of the team.

Leisure Time with Colleagues

A leisure highlight of the conference was joining international internal audit leader colleagues from India, Oman, Qatar and Sri Lanka at an India Premier League (IPL) cricket match between New Delhi and Calcutta. The IPL is being held in Johannesburg because the 4 week India election process has drawn away needed security resources normally assisting with the cricket match. It was a great experience including much in the way of "Americanized" type viewing entertainment; fireworks, cheerleaders, flags and shirts, etc.

We even saw the makings of a small security "skirmish" with a few rowdy fans right near us in a sea of 30,000 being viewed by millions in India!

Topping it off was the quality time spent with internal audit leaders from the other side of the world, enjoying the game and dinner together. Really getting to know more about each other, our families, and ofcourse our audit experiences and views regarding the future direction of the profession. Clearly this was a great bonus experience.

Opening Remarks IIA International Conference, South Africa

Dr. Judge Mervyn King, Chairman of the King Committee on Corporate Governance, in addition to a long list of impressive credentials, gave opening remarks. Dr. Judge King provided a useful perspective regarding the evolution of the corporate organization, including it's increased expectations to be accountable not only for delivering strong financial results and other more narrow, short term priorities, but in the wider

• Human
• Social
• Natural, and
• Financial capital factors of a corporation.

In that context the internal audit functions responsibilities if working effectively should include being

• The right arm of the board
• Trust and confidence of the board
• Give serious consideration to having executive committee membership
• Challenge risk management effectiveness
• Fulfill regulatory requirements, and
• Address compliance

CAE's need to be credible, have good leadership skills, be good communicators, have a strategic mindset and be good networkers

IA's role should rise, but it is up to the internal auditor for this to occur.

International Institute of Internal Auditors Conference-Johannesburg, South Africa

This year's conference kicks off today in the Sandton Convention Centre in the Sandton suburb of Johannesburg, South Africa.
An anticipated 2,000 attendees is expected to include a very small North American representation. This blog will share a daily update of conference highlights, keynote speakers, exhibitor information, etc. intended to prove beneficial to those of you unable to attend the conference.