Focus On Risk Enterprises
In this issue...
A Simple Test
Helpful Hint


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Focus On Risk Enterprises, LLC is registered with the National Association of State Boards of Accountancy (NASBA), as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be addressed tothe National Registry of CPE Sponsors, 150 Fourth Avenue North, Suite 700, Nashville, TN,37219-2417.

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Risk Based Integrated  AuditingTM Seminar

September 19 - 21,


West Palm Beach, Florida

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"Advice is what we ask for when we already know the answer but wish we didn't."

-  Erica Jong


Host a Public Seminar and receive discounts for your entire team!

Does your office have a conference or training room that can hold up to 20 people? Would you be willing to host a public seminar at your office for Focus On Risk? If so, you can receive a discount off the seminar price for each of your attendees! Contact Liz at for more information.
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    July Newsletter




July 4th always brings me fond memories of Peter Osterio, our founder.  Peter was an Australian who moved to the USA as an adult and became a naturalized citizen.  He had very strong feelings about being a US citizen.  He often said he would pay for a one way airline ticket to anywhere in the world for anyone who didn't appreciate the opportunities and freedoms the United States offered its people. 


While going through the company archives, I found an article written by Peter over six years ago.  It is a good test internal auditors should take periodically to assure they are adding value.  I hope you enjoy it.



God Bless America and Peter Osterio!


 - Liz Meyers, CPA, Lead Instructor



  A Simple Test For Your Internal Audit Department

 by Peter Osterio, March 2005


Try this simple test to determine how effective your internal audit department is, especially if your company is in a cost reduction mode in order to compete.  Add up the number of audit report recommendations your team has made to eliminate over control and reduce excessive cost.  If the answer is zero, or every audit report has recommendations to add additional controls, your internal audit department is strategically positioning itself on the wrong side of business realities.  Sadly, traditional internal control and internal audit approaches are unable to deal with over control situations.  They are derived from the government mandated, public accounting approach that is based on billable hours.  Billable hours by definition adds cost.  There is no basis on which to reduce costs.  Companies must reduce costs to survive in the current marketplace.

For a second test, look at every audit report finding and recommendation and put the words "So What?" next to each one.  Is there a clear linkage between a recommendation to improve controls (increase costs) and a specific business objective?  Is there a clear linkage between the amount and cost of the recommended control and amount (limits) of risk that Governance level of the company is prepared to take?

If not, there is a very real chance that the audit department is working on the basis of either "something went wrong, therefore, we need a control" or is simply following a checklist developed by some outside organization. The problem is that the people who produce the outside checklists are not responsible for your company's survival in the marketplace.  Making control recommendations based on something went wrong..."telegraphs" how disconnected the audit function is from the realities of the business world.  Regardless of the quantity and quality of resources that a company has, things will always go wrong (risks) in the ultra competitive, constantly changing business world that we live in.

Be aware of audit groups that claim that they do not have to consider the business objectives.  Their argument is that the reality of the business world is management's problem, not internal audit's and that audit is independent.  This is silly.  Audit is an overhead cost and like all other overhead costs must conduct all its activities being cognizant of the realities of the market place the company competes in. 

Our Risk Based Integrated AuditTM approach is specifically designed to work within the above realities of the business world.


Helpful Hint


Put "So What?" next to every finding or recommendation on your audit report.  Make sure you can explain how your finding or recommendation will relate to accomplishing a specific business objective by keeping a specific risk within the limits approved by Governance.

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RBIA Discount Voucher
Thank you for your interest in Focus On Risk Enterprises Seminars.  When an associate from your company registers for a 2011 Risk Based Integrated Auditing public seminar at, another associate can attend for 50% off of the standard rate. This  Voucher is good for first time attendees and not valid with other discounts.  Call (832) 588-5113 or email  to redeem this voucher. 

Voucher Expires: August 31, 2011