Home Member Sign-in Contact Us Home Member Sign-in Contact Us

In A Staff of 1, The Internal Auditor Plays Outfield, First Base and Pitcher


By Scott McConnell, Kentucky Employers' Mutual Insurance

The fundamental role of an internal audit department, regardless of size, is to "add value" to their respective organization. The method in which this is accomplished and how adding value is defined is often what differentiates audit departments in any given organization. Methodologies utilized are often determined by many factors, including the business environment and the size of the audit department in terms of personnel. What constitutes value to the organization often depends on direction provided by management and the Board of Directors. The purpose of this article is to provide that insight as to the role I fulfill within my organization as an audit department with a staff of one; methodologies I believe are important for fulfilling responsibilities; and how I allocate myself as a resource to the organization.

My role as an internal auditor at Kentucky Employers Mutual Insurance is probably, in essence, very similar to that of any other size audit function at another AASCIF fund. From my perspective, that role is to minimize organizational risk, identify opportunities for improving efficiency and effectiveness in the performance of business processes, and to support management in any way possible to the extent that my personal and professional integrity are not compromised. In terms of my status in the organization, I am independent of management by the fact that I have a direct reporting relationship to the Board of Directors, but report on an administrative and day-to-day basis to the CEO.

Back to Top

In a department of one, a primary concern that must be dealt with is that of audit coverage and how I allocate myself as a resource. Undoubtedly many, if not all, of the issues and risks encountered by state funds larger than KEMI (with larger audit staffs) are also the same issues and risks I must consider. To mitigate this concern, I have adopted two audit protocols. First, I view myself as being a partner with the external and Department of Insurance auditors and always consider the nature and scope of their audit work when prioritizing my efforts. Knowing their audits are primarily financial and compliance oriented, I have tried to complement versus duplicate their efforts by emphasizing operational reviews, thus broadening the overall audit coverage. Secondly, I try to maintain an awareness of all issues affecting the organization by attending relevant management and staff meetings, and by developing excellent working relationships with as many employees as possible. While both of these efforts reduce the amount of time that can be allocated to the actual performance of audits, they are both invaluable in improving the efficiency and effectiveness of an audit.

Within a small department there is obviously also a need for multiple job roles to be fulfilled by a single individual and include that of clerical, staff and management. The concept of performing multiple roles also extends to audit performance in the sense that audit specialization is not possible with respect to the performance of operational, financial, compliance or information technology audits. Both of these realities require that some formalities inherent in each of the above-mentioned roles be compromised in such a way that the integrity and quality of the work performed is not sacrificed. Time must also be allocated so that the main function of the position, to perform internal reviews, is effectively and efficiently accomplished.

In summary, there can be a number of similarities and differences between internal audit departments while fundamentally analogous objectives are trying to be achieved. My role is similar to that of any other auditor of a larger staff, but the methods utilized to accomplish objectives undoubtedly vary. A greater portion of my time in terms of available annual audit hours is probably spent in developing employee relations and attending meetings relative to audit departments with larger staffs. I also try to complement the work of the external and DOI auditors by directing my efforts to areas of organizational risk that neither of them focuses on.

Previous Next

Back to Top


Summer 2001 News
Message from the President
Workers' Comp Cycle
Dim Sum
Sick Building Claims
Eastern, Travelers Balk at MA
Illegal Aliens
North Dakota's 40th Conviction
AASCIF Publications Contest Winners
Court Expands Views of Sexual Harassment
Medical Miracle or Mirage?
Internal Auditor's Role
RSI Not Necessarily an ADA Disability
In a Staff of 1
Auto Audit
Hot Seat Makes a PR Job Sizzle
September 11,2001
Upcoming Events

Related Links
Upcoming Events
Press Releases
Publication Awards
Newsletter Archive




Home | About Us | Directory | News & Events | Library | Contact Us | Member Sign-in

Copyright 2001-2002 American Association of State Compensation Insurance Funds.
All rights reserved.