#InternalAuditingDemystified: The Internal Audit Bucket

Ever considered how internal auditing underpins the success of global leaders like DP World ? Let’s demystify this with a simple yet powerful analogy - "The Bucket."

From uncovering hidden risks to driving operational excellence, the role of internal auditors as unsung heroes safeguarding organisational integrity cannot be overstated. Over the years, I've seen how the insights gained through the lens of auditing have empowered organisations to make informed decisions, enhance efficiency and ultimately elevate our performance to new heights. Our Business Audit team recently collaborated with Group Commercial to identify and share additional revenue opportunities to implement across our different businesses. Our Digital Assurance Solutions team provides business intelligence, insights and opportunities through our data analytics support. Each audit is a journey of discovery, uncovering hidden facets of our operations that demand attention and refinement. Through keen observation and meticulous analysis, we identify potential pitfalls and unveil uncharted opportunities.

As professionals in the world of internal audit, we navigate complex landscapes to ensure our organisations remain robust, compliant and leak-free. But how can we effectively convey the importance of our role to a broader audience? Let’s delve deeper into the bucket analogy, which I’ve used a few times with various stakeholders and has proved to be quite popular:

The Bucket as the Organisation

Let’s envision our organisation as a sturdy bucket, accumulating a vital resource —water (or in our case, financial health, processes and assets). Just as a bucket holds water, our organisation accumulates resources vital for survival and growth.

Roles That Fill the Bucket:

At the forefront of resource accumulation are teams like Finance, Sales, Commercial and Operations, serving as the water carriers. Their efforts directly impact the organisation's success by driving revenue, managing expenses and fostering growth.

The Holes in the Bucket

Lack of Maintenance

Over time, buckets develop leaks due to wear and tear. Similarly, internal controls and processes weaken without regular maintenance. This is where internal auditors step in. We inspect the bucket, identify leaks (control gaps) and recommend repairs. Without maintenance, the bucket (organisation) could lose valuable resources (money, reputation).

Intentional Holes (Fraud)

Imagine someone secretly drilling holes in the bucket to siphon off water. This represents fraud or unethical behaviour. Our Fraud Risk Services teams act as vigilant guards protecting the bucket. They detect and prevent unauthorised siphoning, whilst investigating leaks, plugging the holes and ensuring the bucket’s integrity.

Risk & Resilience

The bucket faces external risks too—storms, pests and theft. Similarly, organisations encounter market volatility, cyber threats and economic downturns. Our Enterprise Risk Management team ensures the bucket is sturdy enough to withstand external pressures and shocks. Running Crisis management simulations; testing business continuity design and readiness as well as risk horizon scanning across our organisation. Internal Auditors then assess these risks to strengthen controls and safeguard against unexpected leaks to ensure decisions are made within a company’s risk appetite.

When it comes to navigating the landscape of risk and opportunity, our internal auditors are also responsible for mapping out the terrain that lies ahead. Beyond the surface-level examination of financial figures, our focus extends further to identifying potential risks that may lurk beneath the surface. We unearth opportunities for improvement, growth and innovation.

The Overflow (Compliance):

Sometimes the bucket overflows. This excess water represents compliance—meeting legal and regulatory requirements. Internal auditors independently verify compliance, ensuring the bucket doesn’t spill beyond its boundaries, or in other words, that the organisation operates within ethical and legal frameworks to avoid costly fines and ensure we retain the license to operate.

The Bottom Line

As independent custodians of the organisational bucket, internal auditors help maintain, inspect and protect it. Our role ensures that the bucket remains full, leaks are patched and water (resources) serves its purpose effectively - or in the case of our organisation, ensuring that it remains resilient, resourceful and leak-free.

The role of internal auditing in fortifying our adaptive capacity is pivotal. By fostering a culture of continuous improvement based on audit insights, we cultivate an organisational mindset that is agile, responsive and forward-thinking. Each audit becomes an opportunity to address existing issues and build a foundation for future challenges. Our function plays a multidimensional role in shaping the success and sustainability of our business at DP World. As much as our audit observations cover control gaps, our Business Audit team also shares recommendations to improve the efficiency and effectiveness of businesses. Our Technology Audit teams work closely with IT teams at the beginning of projects to help independently identify risks to be mitigated before rollout of systems and tools.

Diving into the resilience-building power of well-executed internal audits, the real-world impact lies in contributing to the organisational narrative—a narrative that embraces change, learns from challenges and continuously strives for improvement. At DP World, we recognise that an organisation's true strength is tested through its resilience amid unforeseen challenges, not just in navigating the expected, and this is where we come into play. In essence, the relationship between internal auditing and organisational resilience positions us to go beyond weathering uncertainties to actually thriving amidst them.

Remember, just as a well-maintained bucket provides life-sustaining water, a well-audited organisation thrives and sustains itself. Let’s celebrate the unsung heroes—the auditors—who diligently safeguard organisational integrity, ensuring our buckets remain leak-free in the face of challenges.

This series aims to bring you closer to the heartbeat of internal auditing, shedding light on the experiences that define our approach and the personal insights that fuel our commitment. Stay tuned for more topics to come as we uncover the intricacies of our function. Let's keep the conversation going and share experiences to propel us toward our shared goal of enhancing excellence, trust?and?resilience.

#InternalAuditingDemystified