Internal Auditors, External Auditors, & Strategic Plans

First, in some states the internal auditor reports to the school board, in others to the superintendent, and in others it's a choice. As such, this response won't evenly apply to everyone. 

Second, sometimes auditing is commissioned by the school board for governance purposes, and sometimes it is commissioned by the superintendent for management purposes. Auditing that is commissioned by the school board, whether internal or external, exists to provide independent risk mitigation oversight for the school board (governance) and actionable operations insights for the superintendent and their leadership team (management).

Third, it's also important to note that auditing is entirely distinct from investigating; if you're using auditing for investigative purposes, you're diminishing the value of auditing and not receiving the value of investigating. 

With those caveats in mind, if the internal auditor reports to the school board, the number one risk for the internal auditor to pay attention to is the organization failing to accomplish the board's adopted SMART Goals about student outcomes. There are many other types of risk that are worthy of mitigation, so the auditor's annual auditing plan will have to cover multiple areas including financial, legal, and ethical. But when an internal auditor reports to a school board, none of those should receive a higher priority than Goal risk. Unfortunately, auditors rarely prioritize this risk unless their annual evaluation from the school board incentivizes them to do so (largely because it's not the focus of Generally Accepted Government Auditing Standards). So as a board, ensure that your annual evaluation of your internal auditor is weighted toward a focus on Goal risk and that a plurality or majority of their audit plan is related to Goal risk.

Start with a scope that is tied to your Goals & Guardrails. Have staff prepare a scope document that frames what you want examined in terms of risks to accomplishing the board’s Goals and honoring its Guardrails; this is what external auditors use to customize their plan. If boards don't push for a Goals/Guardrails orientation, external auditors are likely to just copy and paste from their existing playbook, which defeats the point.

Expect independence and collaboration. Auditors must be fully independent of management and any interference from management should be recorded in findings. At the same time, effective audits include meaningful collaboration with management, with management given a chance to respond before the report is released. 

Don’t treat auditors like investigators. Auditing looks at systems for compliance/quality; investigating looks at incidents to determine who/what was responsible. They are different disciplines with different standards and training. Using auditors to run investigations usually harms both functions. If you need investigations, commission that separately.

Remain focused on why school systems exist (ie: improving student outcomes). When external auditing is board-commissioned, its purpose is to reduce organizational risk to SMART student outcome Goals and to inform management’s next steps. If a proposed audit doesn’t clearly advance one of those purposes, question why you're doing it.

Total Public Minutes: 127

 What Coach Celebrates: 

What Coach Recommends:

 We are continuing the Policy Leadership series with a 30-minute webinar on how to adopt high quality Guardrail policies and what to look for in Interim Guardrails.