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Hiring, Developing, and Retaining Staff

Internal Audit Management Training

October 3-4, 2016

Sarah Beth Hall

Inspector General Office of Early Learning

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Hiring Staff

“I am convinced that NOTHING we do is more

important than HIRING AND DEVELOPING

people. At the end of the day, you bet on

people, not on strategies.” --Lawrence Bossidy, Former Chief Operating Officer, GE

“Never hire someone who knows less than you

do about what he’s hired to do.”-

- MALCOLM FORBES,FORMER PUBLISHER OFFORBES

“I hire people brighter than me and then I get

out of their way.” - Lee Iacocca, renowned US automotive executive

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2014-15 AD Round Table

Recruitment & Staff Development

Survey • 53% of respondents stated that they

were in recruitment and training mode

so often that it affects the Internal Audit

activity’s performance.

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Hiring Staff

• Step 1: Needs Assessment

• Step 2: Recruitment

• Step 3: Interview

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Step 1: Needs Assessment

What do you need?

Core Principles for internal audit effectiveness

Red Book Standard

1210 - Proficiency

Position Description

Traits of Good

Internal Auditors

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Core Principles for Internal

Auditing

• Demonstrates integrity.

• Demonstrates competence and due professional care.

• Is objective and free from undue influence (independent).

• Aligns with the strategies, objectives, and risks of the

organization.

• Is appropriately positioned and adequately resourced.

• Demonstrates quality and continuous improvement.

• Communicates effectively.

• Provides risk-based assurance.

• Is insightful, proactive, and future-focused.

• Promotes organizational improvement.

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Standard 1210 – Proficiency

• Internal auditors must possess the

knowledge, skills, and other

competencies needed to perform their

individual responsibilities.

• The internal audit activity collectively

must possess or obtain the knowledge,

skills, and other competencies needed

to perform its responsibilities.

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Knowledge, Skills, & Other

Competencies • Proficiency in applying IA standards, procedures, and

techniques.

• Proficiency in accounting principles and techniques.

• Knowledge to identify the indicators of fraud.

• Knowledge of key IT risks and controls.

• An understanding of management principles.

• An appreciation of the fundamentals of business subjects.

• Skills in dealing with people, understanding human

relations, and maintaining satisfactory relationships.

• Skills in oral and written communications to clearly and

effectively.

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Traits of Good Internal Auditors

• Integrity

• Relationship

Management

• Interpersonal Skills

• Communication Skills

• Socially Adept

• Understand Materiality

• Effectively Use

Resources

• Business and Risk

Acumen

• Natural Inquisitiveness /

Curiosity

• Results Oriented

• Persuasiveness

• Analytical/Critical

thinking

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Position Descriptions

• Statement of Purpose and Objectives.

• Description of the Job.

• Reporting.

• Experience and Skills.

• Description of the Ideal Candidate.

• Other Duties as Assigned.

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What do you have?

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The Gap

Help Wanted!

Integrity

IT Skills

Communication Skills

Relationship Management

Business & Risk Acumen

Forward Thinker

Detail Oriented

Self Starter

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Step 2: Recruitment

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Step 2: Recruitment

• Cast a Wide Net.

• Look for Transferrable Skills.

• Be Flexible in your “must haves.”

• Look for potential and talent instead of just

proven skills.

• Recruit from non-traditional sources.

• Recruit from within.

• Don’t Reject Overqualified Candidates.

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Job Advertisement and Qualifying

Questions

• Job advertisements should:

– Be based on the position description;

– Be Accurate; and

– Include the salary.

Qualifying Questions should be:

– Job Related;

– Simple;

– Clear;

– Specific; and

– Legal.

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Application Review

Initial Review of Applications:

• Did they follow any instructions given in the job posting?

• Did they fill in all of the blanks on the application?

• Did they explain gaps in employment?

• Did you require attachments to the application and are they

there?

• Does the application show that they meet the knowledge, skills,

and abilities in the job posting?

• Is the application spelling error free and grammatically correct?

– Two Strike Rule

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Application Review Continued

Things to look for from a State HR Practitioner’s

perspective:

– Name;

– Education;

– Licensure;

– Employment History; and • Gaps

• Google the company – does it exist

• Job titles

– Background Check.

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Interviewing

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Developing Interview

Questions

• Start with the Position Description.

• Ask questions related to knowledge, skills,

and abilities.

• Ask questions to determine if the candidate

will fit the “corporate culture.”

• Determine the desired answers in advance.

• Ask questions to clarify any gaps in

employment.

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Sample Interview Questions

Category: Time Management

• You are working on a project needed for an audit committee

meeting the following day, and a department manager calls

about possible fraud in his department. How would you handle

the call with the department manager? How would you ensure

the project deadline is met for the committee meeting?

• You arrive for work with a full day’s schedule already planned.

By 9:00 a.m., you get three additional projects that need to be

done right away. How do you cope with this?

• Describe a situation when you were faced with a deadline that

you couldn't meet. How did you handle it?

• Describe a situation when you had to learn a large amount of

material quickly. How did you do it?

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Sample Interview Questions Category: Organizational Skills - Detail Work

• Ask candidates to proofread a loan application where mistakes

could result in processing delays or rejection of the application.

• Ask candidates to proofread a tax return to ensure that it is free

from errors that could result in penalties or delayed refunds.

• Ask candidates to review a written scenario describing a

department s control environment to see if they point out details

of potential weaknesses.

• Tell me which college course required the most attention to

detail. Please tell me how you dealt with the demands of the

class.

• Tell me about a time when you discovered some small item or

detail that helped identify a major audit or tax issue.

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Sample Interview Questions Category: Interpersonal Skills - Client Relations

• You are auditing a department where employees are unhelpful and consistently

delay getting needed information to you. What would you do?

• How would you handle an investigation of an accounting employee you trusted

and respected for making improper journal entries and falsifying financial

statements?

• Tell me about a time when you had to work closely with someone in a position

above (or below) you. Who was the person? What did you have to do? What

was the outcome?

• Tell me about a time when you had to deal with members of the public. Who

was involved? What did they do?

• Tell me about a situation where you detected a client/auditee’s needs and how

you worked to meet those needs.

• Describe a situation where you noted internal control weaknesses and how you

worked to resolve them.

• Tell me about a time others (supervisor or auditee) disagreed with your audit

recommendations. Were you able to persuade them to agree with your

recommendations? If so, how?

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Sample Interview Questions Category: Interpersonal Skills - Staff Relations

• You receive a promotion. One of the staff is extremely resentful (as

he/she was turned down for the promotion) and is being unhelpful and

obstructive. How would you handle the situation?

• How would you respond to a peer who is preventing your team from

completing its project?

• Assume you are a supervisor, and one of your subordinate employees

consistently arrives late to work. What action would you take?

• Tell me about your most recent group or team effort.

• Describe a group work situation where you and a co-worker were

having trouble getting along with each other. How did you resolve the

conflict?

• Tell me about a situation in which you felt others were wrong and you

were right.

• Describe the worst (best) supervisor you’ve ever had. What made him

or her so bad (good), in your opinion?

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Sample Interview Questions Category: Technical Skills

• What would you do if you were performing a project

where you knew you did not have the technical skills

to carry it out?

• How have you applied your technical skills in a

practical and helpful way?

• Tell me about the most difficult work/school problem

you ever faced. What steps did you take to tackle it?

What were the results?

• Describe some steps that are performed when

developing an audit program.

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Sample Interview Questions

Category: Initiative

• If you had to audit an area in which you had no

experience, how would you gain the knowledge to

plan and complete the audit?

• Describe an experience when you had to take charge

and get a job done or resolve a difficult situation.

What did you do? What happened?

• Tell me about a situation in which you were expected

to do a certain thing, and on your own, you went

beyond the call of duty.

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Sample Interview Test

Questions Category: Analytical Skills

• Give candidates a handout with auditee’s lengthy, detailed

responses to various auditor questions. Ask candidates to

summarize auditee responses in a clear, concise manner.

• Give candidates a handout with a scenario describing a number

of internal control weaknesses. Ask them to write a letter

detailing the findings and giving recommendations to strengthen

internal controls.

• For a candidate with prior experience preparing workpapers, ask

him to write review notes for sample workpapers with a number

of needed improvements.

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Single Interviewer or Team?

• No right answer, based on research.

• Follow agency requirements.

• An interview team may prevent

allegations of inappropriate questions or

discriminatory hiring practices.

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10 Interview Best Practices

1. Be prepared.

2. Allow enough time.

3. Diminish interruptions.

4. Create comfortable atmosphere.

5. Be conversational.

6. Ask open-ended questions.

7. Do face-to-face interviews.

8. Don’t ask answered questions.

9. Take thorough notes.

10. Remember your decision is important.

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Other Interview

Recommendations

• Before the interview, give candidates

helpful background information.

• During the interview, listen for red flags.

• Close the interview on a positive note.

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To Test or Not to Test?

• Follow your agency requirements.

• EEOC guidance:

– Tests must not exclude protected classes;

– Tests should be properly validated;

– Test must be job-related and appropriate

for the position; and

– Employers have a responsibility.

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Other Testing Tips

• Conduct tests consistently.

• Minimize distractions.

• Test scores only one element.

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Developing Staff

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New Employee Development

• New Employee Welcome

• New Employee Checklist

• Buddy/Mentor Program

• New Auditor Orientation

• Performance/Expectation Meeting

• Training Audit

• On-the-Job Training

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Retention

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Why Employees Leave

1. Relationship with boss

2. Bored and unchallenged by the

work itself

3. Relationship with co-workers

4. Opportunities to use skills and

abilities

5. Contribution of work to the

organization’s business goals

6. Autonomy and independence

7. Meaningfulness of job

8. Organization's financial stability

9. Overall corporate culture

10. Managements recognition of

employee job performance

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How do you transition from

This… To That!

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Why Employees Stay

Financial Incentives

• Salary;

• Bonuses;

• Stock Options; and

• 401ks, pensions and

other investment options.

Cultural Incentives

• Flexibility;

• Management Training;

• Company Events; and

• Training and

Development

Opportunities.

Source: http://evilhrlady.org/2015/02/8-top-ways-to-retain-your-great-employees.html#sthash.Lnae4vMD.dpuf

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What Employees Want From

Managers

• Reliable and Meaningful

Communication.

• Performance Management Beyond

Annual Reviews.

• Strengths over Weaknesses.

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Employee Retention Strategies

• Provide Challenging Assignments.

• Build Strong Relationships.

• Provide Opportunities to use skills and

abilities.

• Make Learning and Development a

Priority.

• Empower Employees.

• Make it Meaningful.

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Employee Retention Strategies

• Instill trust in and respect for

Management.

• Instill a Positive Corporate Culture.

• Recognize employee job performance.

• Management Training

• Support Auditors in Face of Adversity.

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• Talent Management Strategy.

• Performance Coaching.

• Build Employee Engagement.

Employee Retention Strategies

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Intrinsic Rewards and Other

Motivations

• Individual

recognition in front

of peers.

• Team recognition in

front of peers.

• Participation in

decision-making.

• Greater job

discretion

• Challenging and

interesting work

• Exposure/visibility in

important meetings.

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Intrinsic Rewards and Other

Motivations • Constructive

feedback

• Regular, open

communication.

• Training and

certification support.

• Mentoring &

coaching

arrangements.

• Job security and

workplaces stability.

• Working conditions

to provide work/life

balance (such as

flexible working

arrangements).

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100% Retention Rate?

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In Summary

“The golden rule is to treat

everyone like you want to be

treated. The platinum rule is

to treat everyone, as they

want to be treated. To do

that, you have to connect

with them personally and

understand what matters to

and motivates them.”

- Larry Harrington

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Open Discussion & Questions