July 29, 2025
The Audit Team Manager: How Audit Leadership Drives Organizational Success
Send us a text Episode 141: Curious about what makes audit teams tick? Dive into the crucial yet often misunderstood world of audit team management where leadership goes far beyond checking boxes and finding faults. Audit managers stand as guardians of financial integrity, straddling the strategic vision needed to align with business objectives while directing teams to investigate transactions that might reveal weaknesses in controls. These professionals aren't just looking to catch mistakes...
Episode 141: Curious about what makes audit teams tick? Dive into the crucial yet often misunderstood world of audit team management where leadership goes far beyond checking boxes and finding faults.
Audit managers stand as guardians of financial integrity, straddling the strategic vision needed to align with business objectives while directing teams to investigate transactions that might reveal weaknesses in controls. These professionals aren't just looking to catch mistakes; they're building the foundation of trust upon which all stakeholder relationships depend. As I explore in this episode, "a company's financial reputation is the relevant social currency for doing business in the marketplace today."
The most effective audit leaders combine analytical prowess with exceptional communication skills, positioning themselves not as adversaries but as partners in organizational success. They understand that identifying issues internally before external parties discover them is a service to the organization. The audit team must be uncompromisingly ethical, as I note, "people pleasers make horrible auditors." Their findings, coupled with practical recommendations, drive improved processes, better governance, and ultimately, strategic advantage.
For finance professionals considering career development, time in audit roles offers unique perspective on how business functions interconnect, builds valuable problem-solving capabilities, and establishes you as a trusted advisor. Many successful finance leaders cut their teeth in audit before advancing to roles like finance director or risk manager. Ready to elevate your organization's audit function? Ensure your team has adequate resources, appropriate technology, necessary access, and leadership that values their findings.
What's the state of your audit function? Are you leveraging this critical team to their full potential? Subscribe now for next week's episode where I'll tackle risk assessment in the audit planning process.
Episode outline:
- Key competencies of the audit team,
- How the audit team manager contributes to the strategy and audit plan, and
- How a role in audit can help your career.
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For more resources, please visit Finance Leader Academy: financeleaderacademy.com.
Chapters
00:00 - Introduction to Audit Team Management
01:42 - The Auditor's Responsibility and Mindset
04:20 - Building Effective Governance Through Auditing
05:52 - Key Competencies for Successful Auditors
07:43 - Audit's Role in Supporting Strategy
11:22 - How Auditing Can Advance Your Career
13:10 - Action Items and Episode Conclusion
Transcript
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This week, I am talking about the role of the audit team manager and how they lead the organization's audit process. The stakes are too high in today's business environment to let the auditing function fail.
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Our audit plans must test and verify that our processes are done correctly and how the organization's financial health is presented. Anything less than an accurate representation can hinder an organization from positive stakeholder interaction. A company's financial reputation is the relevant social currency for doing business in the marketplace today, don't tarnish it. Please enjoy the episode.
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Welcome to the finance leader podcast where leadership is bigger than the numbers. I am your host. Stephen McLain, this is the podcast for developing leaders in finance and accounting. Please consider following me on Twitter, Facebook, Instagram and LinkedIn. My usernames and the links are in this episode's show notes. You can also follow finance leader Academy on LinkedIn. Thank you. This is episode number 141, and I will be talking about the role of the audit team manager and the audit team and I will highlight the following topics, number one, key competencies of the audit team. Number two, how the audit team manager contributes to the strategy and audit plan. And three, how a role in audit can help your career banker and author, Hendrick van Lin Smith Jr, said, I don't care how great your products or services are if the company's finances aren't managed well, it's doomed to fail. I am continuing my audit series this week with a review of the audit team manager role and what the audit team does when you have to deal with an auditor reviewing your processes and transactions. It can feel invasive, sometimes scary and a distraction, because you are very busy. We're all very busy.
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We all are and then you have to provide access or answer questions from someone whose job is to find fault in your work.
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That's how we often look at it.
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The auditor is trying to get me in trouble and get me fired, or point out what a horrible job I am doing. The auditor has a tremendous amount of responsibility to review transactions for anything that may misstate an account or even the entire financial statement system, and they are looking for potential fraud. They are it comes with a responsibility to ensure company assets are protected. Now, to be in the right frame of mind, we need to remind ourselves that it's okay for a second set of eyes to verify proper procedures were followed and that we complied with GAAP and any other set of accounting practices, along with how we applied changes with adjusted entries that may have affected the financial statements. As a finance leader, I will always be ready for an audit. I will teach and expect a high level of professional ethics and a high level of technical expertise to properly record transactions and to conduct an effective month end close. That's my responsibility as a leader. Now, did you listen to last week to episode number 140 the audit blueprint, CFOs guide to financial integrity. I opened this auditing series with an overview of how the CFO shapes the audit plan to better support the strategy the internal audit plan ensures better financial accuracy. Now if you missed that episode, please go back to listen when you get a chance. Thank you. To be an effective audit team manager, you must have the ability to see the big picture while also directing your team to find the details that might show a material weakness or a root problem with internal controls, you have to work jointly in the strategic sphere and also become very tactical in the investigation and testing of financial transactions, and if established internal controls are doing their job against asset loss, the stakes are too high if the audit team fails to do their job. Now, where does your organization rate on governance? Accounting practices are, in fact, organized and standardized to create an environment for better governance. Compliance means we are more transparent, we are more accountable. We are doing things within a standard and ethical way of doing business.
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This gives confidence to all of our stakeholders, including investors, government regulators, external auditors and the general public, depending upon our industry, good governance means more opportunities for the business to grow and to grow ethically, we all don't want another Enron.
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I have said this before. Work.
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We don't want to unethically manipulate markets. We want to build a product or service that meets the needs of our customers and that we compete however. We compete on price or quality or some other acceptable and responsible way. The auditing team can help greatly in this.
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Now, what makes a great auditor?
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An auditor should have great analytical skills, industry knowledge, be smart on compliance standards and be technically sound. And above all, should have above average interpersonal skills and communication skills. An auditor must be emotionally strong and professional at all times. The auditor should always be the beacon of ethics and integrity with a lean towards a curiosity in the job at hand, internal auditing will always be torn between doing the right thing and saying what people want to hear your audit leaders must be sharing expectations continually tell the organization's Leaders what you are finding and then develop recommendations to fix it. People pleasers make horrible auditors. Communication is always key. When planning and conducting critical audits, it is important to communicate the importance of the audit being conducted and how it aligns with the bigger picture. Communicate often with those who need to know don't overlook problems.
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Find the issues that can potentially cause a misstatement in the financials or a problem that could lead to a loss in assets due to fraud or waste, be vigilant and determined to help steer their organization to proper accountability and proper governance while working as an auditor, there are several types of certifications you can earn, like certified internal auditor and Certified Fraud Examiner.
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The Institute of Internal Auditors offers several programs like earning a certificate or growing various skills applicable to auditing. Don't ever overlook education opportunities to develop key skills. And you can also earn CPEs at the same time as finance leaders, we should be continually be lifelong learners in the pursuit of our career.
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I'm a huge supporter of continuous improvement, and just getting better. Continuous Improvement means we are always looking for opportunities to do a better job, to be more effective and more efficient.
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This can often translate to cost savings in the long run, the audit team can help perform analysis on how to better improve processes. The audit team is not just there to perform traditional audit functions. Any available capacity provides a chance to look at other areas to improve.
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Now let's talk about the role of audit team manager and the audit team number one key competencies of the audit team. The audit team brings a unique set of skills and capabilities to the company, knowledge of audit standards, communication skills, interpersonal skills, problem solving, the ability to perform a detailed analysis and modeling and the ability to tie governance to the long term strategy they must understand and operate in the strategic realm of the company. So they need to see the big picture and how what they are doing ties back to strategy execution. What they are verifying should align with the business's objectives, even though we expect our audit team to be technical experts on auditing procedures, I also expect auditors to exercise great leadership so the audit process goes smoothly and efficiently. Put the team at ease when digging into their procedures, and the audit team's findings should come with a set of recommendations. Be prepared for pushback, especially when you find anomalies, be prepared to highlight the source of the anomalies and communicate that it is always good for the internal audit team to find and address issues before anyone externally does, be proactive and bring real solutions. Number two, how the audit team manager contributes to the strategy and audit plan. Now, every process in the business must support the overall strategy, including the audit plan. Planning and effective audit strategy begins with aligning with the objectives of the business. The audit team must understand the industry and the service and product portfolio that is being offered. I mentioned earlier that the internal auditing team is critical to helping the organization with financial accuracy, good governance and the protection of company assets. The auditing team must be leveraged to find whether the books or business practices are wrong. I believe that the auditing team must conduct general auditing and specialized auditing throughout the year to verify the financial position and overall health our strategic leaders need to feel confident that the financial health of the organization is correct, that when they lead and speak, that the information they have is accurate, financial information that is incorrect leads. Wrong decisions, eventually it leads to crisis, if not found early. I will talk about risk management in an upcoming episode, but the audit manager operates within the risk model of the organization. Financial Risk is real and must be tested in the audit plan. Develop the plan for each audit by defining the scope and processes, deciding on the methods that will be used, the proper allocation of resources, team assignments and responsibilities, and developing a field work calendar. The audit team leadership works closely with the CFO and other senior leaders on the audit planning calendar, any critical requirements in when and how findings will be reported, the auditing team leadership must practice strong professional ethics. Always do the right thing, check on the protocol for when there is a lack of cooperation or other odd occurrences, the company board, business ownership or required governing body should be the only entities that can alter an internal auditor. Once an audit plan is established and is being conducted, expect external auditors to document and report any discrepancies with access or a lack of cooperation, which can greatly affect stakeholder actions down the road. Number three, how a role in audit can help your career. Auditing helps you see the books and financial statements from a different perspective, and that helps us to see the business as a whole different a different perspective. Helps us to understand how various teams and functions of the business go together to support and achieve a common goal. You will better understand business processes beyond accounting. Additionally, you will become a problem solver due to the complexity of verifying transactions and proper processes, your investigation skills will continue to grow. This will result in you becoming a trusted advisor as you bring results and fix issues, this will translate to more accurate financial statements and better governance, which then results in more investments. You will see your reputation continue to positively grow. A caution to consider, though, errors in the transactions are not always fraud. They could be honest mistakes, which means there is a need for additional training.
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This should be in your findings.
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I have found many times when training was needed and better processes now regarding your career advancement, follow on assignments can include finance director, Risk Manager or internal audit director, and many others down the line. Now, I enjoyed my own auditing experience. I spent a lot of effort talking with people about the importance of strong internal controls and why it mattered that our assets that must be safeguarded. It was strategically important to teach and explain that we should all be working toward a business environment where we all became more efficient so our cash available was maximized in order to ensure our common goals could be more easily achieved. Now for action today. Now let's talk about the audit team for a few minutes. How well resourced is your audit team? Do they have the correct FTEs depending on the size and industry of the organization. Do they have the correct IT systems to manage their auditing responsibilities?
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Do they have access to records, to people and to leadership? Is there a formal process to plan and to schedule the right internal audits throughout the year, and do they have the time to complete everything and to present findings if you are a senior leader, does the audit team have access to you to address ongoing concerns, and are you willing to listen? Do you have the right leadership in place on the audit team? Today, I talked about the role of the audit team manager and the audit team and I highlighted the following points. Number one, key competencies of the audit team. Number two, how the audit team manager contributes to the strategy and audit plan. And three, how a role in audit can help your career. Don't overlook a role or even an entire career in audit, if you like, to solve problems, work with details and help to promote ethics in our profession. Audit may be a great place for you. There are several certification opportunities, and depending upon if you work on the private side or in public accounting, it will help determine which one to earn.
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Next episode, I'll be talking about assessing and measuring risk as it pertains to the audit planning process. I hope you enjoyed the finance leader podcast. You can find this episode wherever you listen to podcasts. If this episode helps you today, please share with a colleague until next time, you can check out more resources at finance leaderacademy.com, and sign up for my weekly updates so you don't miss an episode of the podcast and now go lead your team and I'll see you next time.
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Thank you. You.
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