Putting Executives in the Minds of Auditors—Rookie Mistakes and Lessons Learned
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Bethmara Kessler, CFE, a self-proclaimed troublemaker in public accounting since she graduated college, joined attendees of the 33rd Annual ACFE Global Fraud Conference to speak about how we can advocate for managing fraud risk in a company.
With too many questions for coworkers and a thirst to uncover fraud, Bethmara has been shaking things up in the boardroom for years. She began her session looking back on her younger self, an eager audit professional who spent hours unearthing fraud within her company and prepared to present her findings to her executives. After finishing her presentation, her leadership team asked, “Why are you bringing me something that is too small to care about?” Upset but not defeated, she began her journey of learning how to influence leaders’ and boards’ perspective on the importance of anti-fraud work.
Rookie Mistakes
Bethmara presented some of the mistakes made earlier in her career throughout her session, and from them, the lessons she learned and shared with attendees:
You may have an expertise which is greater than the expertise they have in our field. Executives come from a variety of backgrounds and may not have a full understanding of the operations and what fraud risks may exist in the business.
Fraud doesn’t just happen to everyone else: it can happen to us and to them. Often, we’ll see that some leadership have the view that fraud is what happens to others, and not themselves. Sometimes, the best way to get leaders and boards to pay attention is to show them what fraud looks like.
Think about your responsibility beyond the job tasks. You have a role in shaping the perspective of executives to cultivate the anti-fraud culture.
What matters to you may not matter to leaders and boards.
Problems without solutions are just headaches. If able, formulate a plan to deal with the problem or come up with next steps.
Less is more. Focus on what matters most and will make the most impact.
Who’s on First?
Managing the risk of fraud is a team sport. Senior leadership must make sure they’re engaged in the anti-fraud culture. While there is no one-size-fits-all approach to effectively discharging the responsibility, Bethmara provided a high-level overview of the roles different groups have to play in managing fraud risk.
The Board:
Understands and recognizes fraud risks that impact the business.
Protects the best interests of the stakeholders.
Sets an ethical tone and reasonable expectations.
The Audit Committee:
Has governance, oversight and accountability for FRM activities including whistleblower hotlines and fraud investigations.
Discusses how fraud risks are considered and addressed in audit plans.
The Senior Leadership:
Owns and is accountable for managing the risk of fraud.
Establishes and promotes an anti-fraud culture.
Takes all allegations of fraud seriously and punishes consistently.
With a sneak peek into the boardroom, we can begin to implement these tips to gain access to and influence leader’s and board’s anti-fraud action agenda.
