Transcripts For CSPAN2 Book Discussion 20141005

[inaudible] for helping with all of the organization. Not to mention [inaudible] at the back whos also been a great help. Thank you to all of you, and its been a wonderful and stimulating evening. Thank you. [applause] [inaudible conversations] every weekend booktv offers programming focused on nonfiction authors and books. Keep watching for more here on cspan2, and watch any of our past programs online at booktv. Org. Coming up next on booktv, Richard Chambers talks about his 40year career as an auditor for both business and the government, including his work with the Tennessee Valley authority, the u. S. Postal service and the u. S. Army. This is about an hour. [applause] thank you, leon, and its great to be with you all. This was my home chapter for a number of years, and im delighted to be back and to be a part of your program. This is the first audit conference that weve done with washington chapter for government auditors in a number of years. So were excited to be back and excited to be a part of the program today. This morning im going to share with you some reflections on a career in internal audit. Next year will mark 40 years for me in this profession, and the vast majority of my career was spent in government. And i was asked for, asked about two years ago by some of my colleagues with the iresearch foundation if i might be interested in sharing some of my experiences in a way that would help internal auditors across the spectrum of their career from entry level to heads of internal audits and government, in the government sector, even inspectors general. Help them with some of the challenges that they might encounter by sharing some of my own experiences, some sort of lifebased stories, if you will, from this, from this profession of audit and government auditing and internal auditing. So this morning i would just say my purpose is to give you a quick overview of the stops that i made along the way and then to share with you several key lessons that identify learned that i think that ive learned that i think you might find applicable in your own careers at some point. As some of you know, i started my career in the private sector, worked very briefly with the a commercial bank before joining the gao. I was over at the gao headquarters yesterday to meet with the comptroller general, and walking in there was very nostalgic because it was almost 38 years ago when i first walked the halls of gao as a young trainee there in the offices on g street. I didnt want spend very long with gao, then i moved over to the army and served in the armys civilian internal audit program, the internal review program, where i spent really a sizable chunk of my career. And i moved back down from washington where id come to start my career, moved back to atlanta, and i spent the next 17 years moving up the ranks in the internal review organization at Headquarters Forces command which was based in atlanta at that time. Over the course of those years, i had an opportunity to serve at every level from what we called at that time auditor intern which was a trainee right up to the chief of internal review at forcecom which was a fourstar command, and ill share a couple of my experiences from over these years over the course of our time together this morning. After 17 years there in atlanta, i decided that i wanted to try my hand at work here in washington again. So i moved my family back here, and i joined the pentagon where i was the director of internal review for the army. Had at that time almost 1400 auditors based in 300 locations around the world that i helped to provide some oversight for. Those were very exciting years, very challenging years because they were immediately after the downsizing following the fall of the berlin wall and the socalled peace dividend that was being sought from the department of defense. So a lot of pressures from a budget standpoint. After four years at the pentagon, then i moved over to right up the street here to the u. S. Postal Services Inspector general offices. They were in the process of setting that office up. Postal ig had not had an office historically. Congress mandated a new Inspector General organization there in the mid 1990s, so i moved up there to help the ig who was putting that organization together and spent the next three years as part of the postal Ig Organization, becoming the first deputy ig for the Postal Service. Then i moved down, as ill talk about later, moved down to knoxville where i served as the Inspector General of the Tennessee Valley authority. And following a turn of events regarding the ig act and the reclassification of that position to a president ial appointee, i took an early retirement and went to the iia and have been with the institute of internal auditors twice over the last 14 years and in the middle i spent about five years as the National Practice leader for pricewaterhousecoopers over their internal audit advisory services. So over the course of my years, ive had an opportunity to work in internal audit and ig work, within government, ive had a chance to work in the notforprofit sector, and ive also had a chance to work in the corporate sector via one of the big four accounting firms. So overall its been an exciting career, and i think i picked up more than a few anecdotes along the way that some of you will find relevant here this morning. So with that, let me share with you some of the things that ive learned that i think regardless of where you are in your career, you east have encount you either have encountered or youre likely to encounter the lessons that auditors in government invariably have to address. The first one is really that stakeholders judge our value. Internal auditors and government auditors definitely have stakeholderrings. It took me a while to figure that out as a young auditor. I assumed that we were there because there was an Army Regulation that said that we should be there. Audit activities were supposed to be organized in every command around the world, this internal review program that had been in place since the end of world war ii. I didnt have any question that we had place to be because the regulations mandated it. It really wasnt until i became the director of internal review for the army right after the fall of the wall and the end of the cold war, and there was a lot of pressure on downsizing within the military. There was an expectation that we were going to save some money for the taxpayers. And what i discovered immediately upon assuming the the role of the director of internal review at the pentagon was that our resources out will around the world were being dramatically downsized, more dramatically than the armys budget. In some places we were seeing our internal Audit Departments cut by 75 or more. Certainly, the budgets in the military were being reduced, but not by that much. So i spent about six weeks right after i got here to washington and joined the staff down at the pentagon. I spent about six weeks traveling around the world and talking to military commanders, to other military officers and to others within Army Activities around the world about what was it that internal review was not delivering that really caused them to make these very difficult decisions to reduce the staffing . And i heard a lot, and i learned a lot, and it was probably most, the most rewarding experience from a learning standpoint that i had encountered up to that point in my career. What i heard was stakeholders, those who relied on internal audits work making very difficult assessments of the value that they were getting. I would hear Army Commanders say, you know, i know how important it is to have an internal audit function, i understand the value that they can provide me, but in this at this time i have to make very difficult decisions. I either have to spend money on i either have money that i have to spend on Family Housing for my soldiers or audit. And i dont think that its a choice for me. I felt like that was a false choice because i thought what they were really doing was, as one of the Army Generals later coined it, they were eating their seed corn. Because be you get rid of your audit if you get rid of your audit capability at a time when youve got to figure out how to reduce your resources, youve taken away the very people who are going to be there to help you do that. So i heard other stories as well. Id hear commanders say, you know, the audits take too long. I need somebody who can come in here and tell me what time it is, and by the time i get an audit report, theyre telling me how to fix the watch. I heard them talk about the auditors were not focused on the real issues and challenges. I heard them talk about the fact that they needed quick decisions or quick information or speedy information for decision can making. So decision making. So i came back with a really keen understanding that the decisions that were being made by those who were making the investment in audit was that they were having to make that assessment based on what they judged the value of the function to be. And it really helped us to formulate our own strategies over at the pentagon for how we were going to reengineer our internal review organization at the time. Today when we think about stakeholders in the corporate sector or even government, were off talking about audit committees who represent the board and their action with internal audit. Were talking about executive management. If im in the ig community, im certainly speaking about the executive management of my agency, but im also speaking about in the ig community, for example im also speaking about congress and the fact that i have these competing or not competing always, but these dual reporting relationships. Were speaking about operating management within our organizations and within our agencies. And were also speaking about citizens and taxpayers and others. So we have a vast portfolio of stakeholders with whom we have to interact and have to address. Some of the common stakeholder concerns that we hear and this is true where were speaking about government or were speaking about the corporate sector, is that the auditors dont understand the business, that we dont understand what it is that theyre trying to do. We heard that a lot in the early years over at the Postal Service because the Postal Service had been in place for almost 200 years before the Ig Organization was created. And postal officials were not all that excited about the idea of having an ig, and even the board wasnt all that thrilled with the ig idea. And so what we often heard as we started to conduct audits there was, you know, this is a little bit complex. Its too complex for your guys to understand. You dont have the expertise, you dont know or understand the business. And i think we hear that a lot today. And youre going to hear that much more frequently when youre trying to audit operations than you will hear it if youre auditing things like financial assessment, financial controls or compliance issues. Youre much more likely to hear complaints about not understanding the business if youre doing operational auditing. Theres also this enduring concern that somehow as internal auditors were not the most effective communicators. And theyre not talking strictly about the written product, although sometimes they feel like those are too voluminous and that theyre very difficult for management to make their way through them, but theyre talking about the regular and Interactive Communications that we should be having throughout our audit processes. Theyre looking for assurance, but theyre also looking for advice. Theyre looking for insights. Because in most organizations we have more expertise on controls and on Risk Management than they do, and theyre looking for us to tell them at the outset of an initiative or while an initiative is being undertaken, theyre looking for our insights on that. I had the opportunity during my years at the pentagon to serve on a reengineering project of the travel program for the department of defense, and i wasnt there as an auditor, i wasnt in the room to vote, but i was definitely there as senior officials were making decisions about cutting controls and streamlining processes. I was there to offer my perspectives about which ones, which controls were critical and what the risks would be if some of the key controls were eliminated in the interest or in the name of speeding up the process. And then finally, were also hearing even today the same thing that we heard 20 years ago at the pentagon, were hearing about value for money. Were making a big investment in audit, are we getting our moneys worth . What is the value that i get out of audit . And so these are enduring challenges whether youre in the corporate sector or whether youre in the public sector. The second of the lessons that i want to share with you is that about building and sustaining relationships. You know, unlike our external audit colleagues who tend to be a bit more nomadic, they will serve at an organization for a while and then they move on perhaps to a different client, they serve one client from an external audit standpoint, then they move to a different one. Unlike them, we have to live where we work, and thats true whether were auditing government or whether were in the corporate audit world. We need to be in the organization, and our mission is to be within the organization and to be organized within our organizations over the long term. And im going to tell you from my experiences over the course of my career, those who are more successful whether youre in an ig model or whether youre in an internal audit in government model or an internal model in the corporate sector, those who are more successful in building and sustaining relationships within the organization notice i didnt say cozy relationships, im talking about relationships, the ability to communicate and to have a degree of trust in interactions those who are able to do that are far more successful. Things are not well organized, petraeus are not working something has to be communicated at some point. Management doesnt want to hear and i would tell you that the ability to do that diplomatically and the nonthreatening way will often be to benefit more in the long run. The ability to help manage and understand what lies ahead or that lies around the corner. We would have to be able to demonstrate. There has to be a perception on the part of management and Agency Officials that we can be trusted to do the same under the same circumstances. Leadership and empathy these are all characteristics that i think we have to be able to demonstrate. I think relationships can also enhance relationship acumen can also enhance your value and can actually help you be more successful over the course of your career. When i look at the Postal Service early in 2000 and the act at that point was appointed by the agency and in our case to the board, so the board offered me the position and i went down and i assumed the role of the Inspector General. For a lot of reasons i wont get into there was a bill working its way through congress to amend the act and make the position of plaintiff. I understood the risks when i went down and i did things that we might have a little longer before the bill was enacted but sure enough i only been there for a few months and there was a writer attached on the legislation right about the end of 2000 plus while the election it was while the election was still hanging about and actually did make that a president ially appointed position and there was a provision that said that the incumbent could stay in that post until the president elected to make an appointment. I needed to have 25 years to take the early retirement and so i just thought that this is going to take a while, new president coming in whichever one it was able to take a while to work their way down the list to the position and sure enough it did that the next summer in 2001 i was traveling out of town and i got a call and it was the director of the president ial personnel calling on behalf of president bush and he said. Tell me just a little bit of the back story and once i knew. If i were to retire and do Something Else one of the things i did was to work very hard in those ensuing months to build some strong relationships on the hill because the service area spans seven states and the 28 house members who have jurisdiction over some part of the service area. We spend one or two days every month coming to washington from knoxville and walk the halls of capitol hill meeting the staffers and members of congress listening to their concerns and making sure that the plans address the concerns and being responsive that they had concerns i thought thats what i needed to do to be an effective ig so when that call came in the summer of 2001 and the voice on the other end told me the president decided to make his appointment to be determined by a assumption is that they had gone through a vetting process and they were going to be naming someone who had been nominated or put forward by congress so i was very surprised when he said i asked him who is the nominee going to be and he said the president has decided he would like to nominate you for the position. Im a career Civil Servant and i never indicated an interest in the post. He said weve been talking on the hill and almost everyone weve spoken with all of the key senators who have jurisdiction over the area all want you to stay because they feel like you have a strong working relationship and so i guess i would simply say that was not my intent and it was the furthest thing from my mind to be able to build relationships so that i would somehow get the nomination but that is in fact the way things worked out so building and sustaining relationships will make us stronger in every post that we hold in the career. As i discussed in the book the buck ive done a lot of soulsearching and i finally did decide to decline the opportunity and take the early their early retirement but it certainly was another important lesson about why its important to build and sustain those relationships. I think its also important and this is something that the government weve got to really make a priority is to follow the risks. We really need to follow the risks wherever they lead us because if weve learned anything about the risks of the last 15 to 20 years is that they are very dynamic and belinda crossed shift very rapidly. We used to have to help us decide where some of the audit priorities should be in the coming year. By the time i left to go down to tennessee and i thought i know i got it i understand the Risk Assessments and so i showed up probably my staff would tell the bishops about eric and thinking i knew it all and i was going to teach them all to be Risk Assessment. I showed up and of course i knew that tba at Nuclear Power plants in the Tennessee Valley and my assumption is those Nuclear Plants presented the greatest risk. After a few days being schooled in with the Risk Assessment was about, i understood the real risk wasnt the Nuclear Plants, it was the cold and acquisition of the coal and other fossil fuels. Because thats where the vast preponderance of money was spent and there might be an event at a Nuclear Plant and the likelihood was mitigated by all of the controls and all of the oversight and all the others that had a role to play there. I learned quickly that risk is two dimensional. For the public libyan likelihood and you have to take both of those into account if youre going to be out there. I learned how quickly the risks could change. The chief of review at the command. We had all of the audits we were going to conduct throughout the command and the chief of staff and the commanding general were all on board and love and behold in the fall of 1989, Saddam Hussein invaded kuwait and spend the next six months being responsive to those that were emerging. We need to add to adapt the audit coverage and some of the things we are hearing about in 2014, 25 years later we are hearing about Cyber Security risks and we can barely go through a week that theres not a major Cyber Security breach somewhere in the country usually with one of the brandname retail concerns. Cloud computing and all of the vulnerabilities that are presented their. Of mobile technology and thirdparty risks. Its becoming increasingly clear that you may have followed your risks controlled and great control internally, but unless you understand how well controlled with Third Party Contractors and others are, you really dont know what your risks are. And we also see the looming deadline for 2013 but presenting a risk for a lot of organizations to be able to get compliance by december of this year and then the social media. The risks are driving the audit plans and driving changes to the audits plans in 2014. At the speed of risk we have to be able to adapt the plans based on where those risks are emerging from. Theres formal methods for doing it and informal methods. There are a lot of different ways you can update that Risk Assessment on an ongoing basis, but the point is weve got to be more agile to where the risks are and where they are coming from. The life lesson is one that i think is particularly appropriate speaking with government audit groups, and that is the whole challenge of timeliness. We need to audit the speed of risk, but we also need to put the audit reports out at the speed of the need of information of the key stakeholders. I learned early in my career. In addition to being in charge of the internal audit activity force command we were all busily a honestly is on for the outside agencies we had 40 ongoing audits from outside activities in our command. He said i think its covered one third by land and two thirds by auditors. My experience, when i first took over that role sort of stayed with me over the years. We had the units literally positioned all over the United States we would get these audits from the audit army agency or one of the other organizations was doing all that work got a report in and the overall effectiveness of one of the engineer battalions and i looked at it and i was fairly familiar with the force structure. I called my deputy and said where is this and he said that engineer units was reestablished two years ago and we said we are just getting the audit report and he said it took them a while helped me to appreciate that we do have to stay on top of this. Ive seen audits in my time in government particularly and occasionally in the corporate sector. Once the audit starts to take that long, the value of the information contained goes down dramatically. If we take years to tell the others what we found we arent delivering the kind of value that we should. Ive taught about this and ive been an evangelist this time of year being able to audit quickly about the roadmap for the gps we are going to get lost. I talked about some of the techniques in the field work. The leveraging technology and being able to be more efficient in the way we undertake fieldwork and thats also important. And the reporting phase was also very sawyer the father of modern internal audit said the sources of the friction in the Audit Department succeeded that caused by the raging in all of us in the room probably very few scars from the audit reports we try to get out and somebody disagreed in the wording. Getting the consensus of the Audit Department sometimes is tougher than getting agreement with the Agency Officials on the findings and recommendations. I talked about different techniques that could be deployed into the idea that sharing the results so that you dont dump all of the audit results on the management at the end of the process and of eliminating and reducing the levels of the review and large audit organizations can often have five, six, seven levels of review and the more levels of review that you have on the draft report of the longer its going to take to get it out. These to be the audit reports and get them all the way up to the editing process. What we employed over during my years at coastal ig. And its this idea of team editing. What we would do there is weve actually pull. We pulled altogether in a room and say look, this report is going to be finalized with all of us in the room so we are sending it to you and then to you and you and we are going to edit the report together and put it up on the screen and then we will know that is the way that report should be worded. And it will prove to be a very effective way of getting the draft report through the editing process. We were able to get the draft report in the management hand after a week at the end of the fieldwork. It takes commitment and effort and a little more time. It took on average 30 minutes a page. We have a lot of staff time to get that done and we certainly speeded that audit a long and all that it to be a very effective tool in making sure that we were not late. One i still find to be pretty fascinating and pretty entertaining in fact the wall street journal ran the excerpt this entire chapter on their website on the risks website a few months ago because what i found and what i think resonates with people is that sometimes it isnt the really spectacular audit findings or the spectacular result in the audits that generate the most reaction. People sometimes can resonate with things that we think are relatively insignificant or raid was would have reminder observations. Pretty good exhibit at the National Training center. Looking at all the processes that we are in avoiding and i was doing an audit of the contract process. Acquiring the supplies into and materials and used those as an example. If there were more trash cans then we were going to have soldiers and civilian stations. Obviously not a good requirement determination. And i remember i just used as an example in the report and i remember what an uproar it caused in iran under the contracting officer almost with tears in his eyes saying you are going to get fired from that report. And i thought to myself that really wasnt that big of a deal but what it is that did is it resonated with other officials and with those who were responsible for overseeing the area. And so, it was a big deal to them. A few years later i had another example where i have discovered that we could look at one of our subordinate commands who is gotten some money with our commands to help deployed soldiers to desert storm. I observed a number of new telephone poles laying in a stockyard. And i found others were paid for by the command. They never got shipped over to the middle east and they were going to be used in the future in the commands i visited. To make a long story short i had a two star general who got the other command. I thought it was kind of amusing. Id been out of the army war college. They probably didnt know as much as he did. I did note a gold plating when i saw it. But anyway we have to realize that some people will get your attention and really fire them up and i remember when i was the postal Postal Service and we didnt actually discover this but we got cold and very quickly to look at it. I was driving to work one morning and i heard on the news that the Postal Service but acknowledged that it had printed some 200 or 300 million stamps, firstclass stamps honoring the grand canyon and have identified the grand canyon as being in colorado in its off a firestorm in arizona and actually here in washington. How could such a mistake been made. So, it is the Little Things sometimes that really do generate the most excitement. I think we have to realize that when we put our reports together. Waste and inefficiency present make big. I think some of us are around long enough we would realize that the 600dollar hammers in the toilet seats and all of the examples that got circulated back in the 1980s we did an audit of the refurbishment of the Chairmans Office up in nashville and identified some extravagant expensive furnishings. We didnt call them extravagant. We let the public make that call, but we found a very expensive etched in class that had been put up in the room and we found one of the libraries have been panel with custom build with the permanent plantation there that i think the cost of paneling that library was almost 300,000 it was least based. So that generated a firestorm of publicity across the valley. I think we have to stress the magnitude of the reports so that we dont give the impression that something is more widespread than it actually is. Dont sensationalize the press and others will do that for you. And be prepared for the reaction. My favorite story is the study at Home Projects when i was the ig. We got a call that alleging some employees were using their personal using their business computers. They signed up for the study at home. We got a screensaver and while you are not using your computer sometimes it was university or some place was able to sort of tap into your computer or use its capability to assess radio waves from out of space to see if there is any kind of extraterrestrial life. Out of the 13,000 employees we made a minor note we conducted it i think is an investigation in a semiannual report to congress and the roof came off. It made the news in australia. So i would just tell you things will go viral and that was in the early days of the internet. Now it will go viable much faster, and i dont know that it could get much further from here to australia but these are things i think all of us have to keep in mind is the small stones can sometimes cause the biggest waves. No one is immune including those of us in the audit profession. The government auditors and corporate auditors over the last few years i seen trends where the loyalty to the Senior Executives i think that there were allegations tossed around a few months ago about one of the acting igs in washington who was being accused of becoming or maybe being too close to some of the Senior Executives in the organization desire to protect the organization. Sometimes things dont get reported because we dont want to embarrass our own organization her own organization but that never works out well by the way. The code of ethics either from the ira or the corporate code of ethics. Looking at the ethical audit leaders i often think that they were honest and its important people preceded that they were honest and we are doing something illegal or illicit on our own and courageous and courageous audits i think that we have to be government auditors and courageous and accountable. We have a situation where we discovered that we had a Fitness Center that had been built. At that time you can only build for up to 250,000. It is contract splitting and what they did is they built three different wings and they connected them together by a common hallway and somehow they were each separate projects and so we wrote it up in an audit report and its sort of the roof came off. Nobody was really happy with us about that. The chief of chief of staff decided we have got to convene an investigation because we may need to have there may be a courtmartial here if somebody has intentionally violated the law. I remember sitting down with our legal guy and i was a civilian and he was either a very senior colonel or general. And i was talking to him we would have monthly meetings and he was telling me this is after the audit report came out he was telling me that one of the members of his team is going to be conducting this potential courtmartial investigation. There is a set courage and without really thinking i said colonel or general i cant remember, but colonel, do you think your staff can do that too edifies me these projects were legal. I thought they were going to conduct the investigation. The general general look and apparently they had a conflict of interest. And so i think sometimes you have to be willing to do Something Like that because courage is what makes us effective in our roles. I have another story to share here on this when i got a call from one of my subordinate heads and she was telling me that the it department on her command had invited or have asked her if she would detail the auditor from her in organization on the it area which she detailed from over the implementations. The recommendations were going to streamline some of the processes and would likely result in the need for fewer staff and they thought that the staff would be as enthusiastic about implementing its recommendations. So, we had a long talk about it and my advice to her was not to do it. I said i dont think you should. The Government Office standards would indicate that your not going to be able to go back in there and become objective in doing the work so i dont think that you should do it and that was the end of the conversation and then a few months later i get this very official looking document and it is a subpoena for me to appear before the federal relations judge in texas to testify about the propriety of using internal audit staff to conduct work for management specifically that internal audit staff at this Army Installation have been used to implement corrective actions in the it area and the local union filed a grievance or a lawsuit so i got on the phone and i called her and i said i thought we talked about this and you were not going to do this and she said well i wasnt but then they offered me all new computers if i would send her over so we just have to be careful because at that point of course it would have been very difficult for them to have been perceived as being objectively drawn. Finally, let me just talk about this concept of the seat of the table. It is being banned or around a lot in the corporate sector and the internal auditors and the auditors and the organizations say we need to have a seat at the table and we need to be there when the management is considering looking at new strategies so that we can offer or share our insights and we do need to understand the Business Strategy formulation and being in the room makes it easier we do need to understand how the management implements controls. If we get a seat at the table and we are in the room when the executive management is having these meetings we cannot be seen using our time there to get leads. It is a means. A seat at the table is the means to be more effective as the auditors in the future. Isnt that somehow it isnt that somehow we have a rise because we are in the room sitting there with management. A trusted advisors are always welcome at the table. When i first became the ig ira member talking to the ceo at the time and saying i would really like to attend the regular monthly meetings with the board and the Senior Executives and no other ig before me had ever done it but all of those that had preceded me how subatomic level investigative background and so there wasnt kind of harmony i think that had perhaps you can achieve if there is a perception that there is no out to pitcher concept. It would have a Chilling Effect on the conversation. Nobody was going to say anything if you were in the room so we went back and forth and finally i convinced them to let me come here periodically. I could have forced it perhaps that wouldnt have been here the first time at the meeting i was like the elephant in the room. It wasnt my role as wearing my ig im going to get chat. I used an analogy that that a seat at the table was like going to a potluck dinner. If you show up without a dish, youre probably not going to get invited back. The inspectors general or the members of the community if we do have a seat at the table it is important that we go in with the right attitude and the share what we can. We are obviously not going to be sacrificing our independence or our objectivity by being a decisionmaker or participating in the decisionmaking process. But it can be very valuable insight. I talked about the idea of the trusted advisor and obviously it becomes more difficult in some of the statutory roles that we played but i believe the trusted advisors are the results of the least two different dimensions. Building and sustaining strong relationships and the other is competence just how well do you understand the risks and control the government and how well do you understand the Enterprise Organization . Is in the strong relationships and preceded by those in the organizations as being real experts and risk control and governance. I would like to do is take the last few minutes and open it up and to see if you have any questions for me that i might be able to answer for you. Several of the fortune 500 companies and the consultant capacities. Somehow it completely changes the whole purpose and the model of auditing and it doesnt. At the end of the day the thing that we all have in common is that we are all trying to provide assurance. The efficiency and effectiveness of the organizations and the adequacy of controls, that is a common characteristic that the auditors whether they are in the corporate scum of the, the non for profit or in the government space. I do think that there is differences. One of the differences obviously in the corporate sector they are using the internal audit function as a Training Ground in the pipeline of talent to the company, ge has pioneered about processing number of years ago and a member number of the leading companies do that today. They attended excuse to the corporate sector they relied more on the Risk Assessment to build the audit plans for there are some differences but there are also something was the government that the government does much better. I think the government audits tend to have a high degree of quality. They may get in trouble with some of the corporate counterparts for saying that, but the time and their resources are often invested because the fact the government audits are made public and the risk of being wrong is much greater. If you make a minor mistake and youre in a corporate setting in the internal audit report is a minor mistake nobody knows that outside your company. If youre an Inspector General or the gal and publish a report with some inaccurate and it maintains the entire credibility. Second there is more time and resources and effort involved. I also think the government does a better job of training the folks because in many cases particularly the budget ones, there is an important investment [inaudible] the biggest dilemma i would say that i faced certainly from the professional standpoint that the dilemma whether to stay and take the president ial appointment or retire early death is one that took me quite a bit of soulsearching to decide what i wanted to do. In the corporate setting, excuse me in my internal audit settings i would say that there were a few dilemmas along the way. Several of them i touched on during my conversation here. One of them i was new to the organization trying to establish some working relations and one of the things i would get is a regular report on the travel plans of individuals within the organization. Anybody traveling outside of the United States is a corporate style to together and one day the report floated across my desk and it indicated that our chairman of the board was going to be traveling to paris and that rationale was to attend the paris air show. At that time we were just a lightning rod for the congressional criticism because the senate was in the hands of one party and our chairman and was in a different party. There was a lot of this stuff back and forth and i thought we are going to get criticized if gets out. And so i debated to my Say Something before it happens or do i just wait and hope that it doesnt get out and i said you know i think its important for me to be part of the conscience of this organization. So i picked up the phone and i just said ive got the report and you are free to do whatever you want but i think this is something that if this is the only purpose, it is going to be criticized. And i think that we have to be willing to do that. I talked about the audit ethics continue on. On the one extreme is those that were complicit in the other extreme the conscience of the organization and in the middle middle i illustrate some are spectators and some are referees. A lot of us are just referees in the organization. We are there to throw the flag or to blow the whistle after the play. We have to become more proactive and willing to speak up and blow the whistle before the play if we see something is going to be upheld. [applause] what is something that is there something that [inaudible] what have i seen over the course of my career how ive seen the profession gets better and what have i seen in terms of the profession getting worse this is one that has been on the trajectory of improvement for the last halfcentury. And really throughout its history. But the thing that i think we are doing today that we were not doing when i first came into this profession in the mid mid1970s is that we are providing not just hindsight looking behind. Its like driving down the road youre not going to be very effective if you only look in the rearview mirror. Occasionally you have to see whats happening and we also have to be looking ahead. So weve gone from hindsight back in the 70s and in the 60s and 70s when i first came into the profession. We still provide some hindsight and look at what happened last year, last week, last month but increasingly we are provided insight and assessment of whats happening in the here and the now and i think that our ultimate destiny is going to be providing foresight in addition to the hindsight this is something that david walker the former comptroller general harped on and articulated well. We need to be able to provide hindsight and foresight to be a true value to our organization. Ladies and gentlemen, thank you very much. Im going to be around and i would be delighted to have further conversations. Thank you again for the invitation. [applause] naturalist doug peacock looked at the the the time of change on animals, humans 15,000 years ago and talks talked about what we should take away from that history. He argues what with legal experience in the future will be worse. bush back thank you. I came down my favorite river today from from up around just below yellowstone and the great Yellowstone River that the indians called the elk river is always my favorite river in the world. When russell came through here in the later 1830s, he noted that there were more grizzly bears on the elk river bottom ban any place van anyplace that he did then and this was a man that had been through all of it was everything else. This place. So it wasnt hard to get down here and of course the reason that im here today is because todays the anniversary of 9 11. Its an event that launched the modern series of war, and and inevitably that led to a couple more generations of investments