POST BY DR. KEVIN DUNGEY

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This is the first in an 11-part course on writing effective audit reports.

(1,777 words: approximate reading time = 6 minutes)

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Yes. Writing an audit report is not an art; it is a craft. Audit report writing is not a job for writing savants, people born with some ability to communicate in writing as some people seem born to express themselves musically. Let's say that one more time: audit report writing is a craft; it can be learned and has been learned and learned very well.

However, mastering any craft requires a lot of practice. But, practice can make imperfect if the wrong things are being practiced. Thus, audit report writers must begin by understanding and mastering the fundamental tools of writing an audit report. These tools serve as the "North Star."

This 11-part course, which will become a book, replicates the ever-evolving (to higher life forms), three-day, audit-report-writing training course (called Writing Tools for Auditors) we have delivered to many thousands of auditors over the past 30 years throughout the national and even international audit community. Its goal is to provide, above all, a set of objective criteria for writing and reviewing audit reports. These objective criteria serve to create a common vocabulary for talking about writing that audit report writers and reviewers can (and should; must?) share to make the process of writing audit reports less subjective, more efficient, and more effective. These objective criteria remove as much wrangling about “personal preference” from the writing and review process as is humanly possible.

These objective writing criteria are not yet, we regret to say, taught in high schools or even universities and colleges, not even in those major fields, like accounting and finance, where auditors tend to be formed. Through college, writers learn to write for teachers. The maxim is "if you figure out what the teacher wants, you will get a good grade." Writers learn that writing is a subjective enterprise, that every writing teacher has his or her own style.

Worst of all, even at the college level, writers never get to write about something teachers actually needed or wanted to know. That is because every college teacher is required to "know" his or her field, in most cases to hold a PhD in the area. Student writers never can know as much.   The authors of this text remember writing papers on Shakespeare plays, for example, for people with PhDs in Shakespeare, who had written books about Shakespeare, who sometimes acted as if they had known him personally. There never was any content to provide that teachers didn't already know. They did not need or really want anything we had to say about Shakespeare.

The world of audit reports is completely different. Audit reports, by their nature, report on what is not known, not even by the individuals running the programs under audit. Typically that audit knowledge is critical and novel and often persuades important people--decision makers, we call them--of the need for corrective action.

In addition, all through school, even graduate school, a writer writes on his own, decides alone what she wants to say; decides how he wants to say it. However, in any audit shop, there is no single author and therefore none of the writer ownership so common in academia. It's never a single writer's product, though an individual's ability to write well is highly prized and leads to promotion. Audit reports are an office product; they belong to everyone. Everything that is written in an audit report has to navigate all the team members, stakeholders, and managers that stand in the way of publishing the report. Not even a PhD thesis faces that sort of scrutiny; college writers cannot be prepared for it: all those red marks, track changes, over and over again, as everyone tries to get it right.

An audit report is written and rewritten (and, let's be honest, rewritten and rewritten) by a team. Then it is meticulously vetted, rewritten, and vetted again (and sometimes) again up through the audit office chain of stakeholders for accuracy, objectivity, clarity, usefulness, tone, legality, methodological robustness, and, of course, style.

Now Style is unfortunately what most people think about when they think about “writing." We strongly disagree: writing is more than style, much more than choosing the right words, arranging them into sentences that are correctly constructed and punctuated, and even building them into paragraphs. “Writing” ismuch more about the critical thinking that goes into designing and performing the audit, the logic, and all the other necessary (seemingly endless) audit steps and activities that go into developing a sound, reliable audit message. Good writing emerges from good thinking. This book argues that you have to have a sound message before you dare present it. No amount of polishing or editing can redeem an unsound report. Shakespeare himself couldn't fix it.

Let's be frank. The kind of reports an organization actually produces reflects the organization itself. A good report (by "good," we mean useful and easy to read) is no accident and no result of solitary genius. A good report emerges from an intentional process, much as a finished automobile rolls off an assembly line for delivery to a buyer. There is an order to building a car that begins with plans and designs and ends with a beautiful paint job. If a car is unsound and unreliable, no amount of paint buffing will fix it.

Writing, as we think of it, is really not the putting of words to paper, any more than a great car comes out of the paint sprayers in the factory paint room. If that were true, Earl Scheib, car painter extraordinaire, would make a car merely by painting it. Writing a report is assembling the key elements, and those elements emerge from the audit process itself and from the questions that are asked..

But enough about the writer. The one consideration that focuses all these audit activities and procedures and headaches is the audit report reader. Just as a physician would be of little use without a patient, an audit report would be useless without an intended reader (similarly, a client). Like a patient, an audit report reader/client needs an accurate diagnosis of and a way out of whatever problems there are. True, lots ofdifferent people may read any given audit report: the general public, the media, academics, special interest groups,  the agencies and programs being audited, and those official bodies charged to oversee these agencies and programs. But we focus on by far the most important reader, the person with the power to assess the report findings, to weigh the recommendations, and to make (or refuse to make) the changes the audit report is built to sell.

Just as a physician serves her patient to make him well, so the audit report writer serves the reader to help make the entity, the program under audit more efficient and more effective. Patients are persuaded by test results to take medicine; audit report readers are persuaded by audit results to take recommendations (seriously).  Reader? How about an audit report user. That is what the Yellow Book calls a reader. A patient uses a diagnosis to become well, and an audit report user does something very similar.

The objective criteria for writing and reviewing audit reports we provide are all predicated on communicating useful, readable information to the audit report user, who, we claim, is very, very busy, and almost always very resistant to the idea of lots of reading (Will a busy decision-maker read a report of 50 pages? We think that expecting them to read 5 pages is too risky), and very much focused on the bottom-line.

As we said, the major outcome for this course, which will become a book, is to establish objective criteria for writing/reviewing audit reports. These objective criteria make up the writing tools audit report writers need to cultivate. These 10 tools are employed at various stages in the audit job process and in the order listed here:

1.    Understand the audit issue. What is the issue and why is this an appropriate time to look into it? And why does the issue matter? What makes it important to audit? Usually money, safety, program integrity are at stake.

2.   Be responsive to the issue by developing an audit objective or objectives that is researchable, unbiased, neutral, and appropriately phrased. This objective(s) guides the work.

3.   Answer the objective directly and accurately. This answer is the major finding; there must be a logical link from audit objective to finding to recommendation.

4.   Support and develop the argument for the answer/finding. Employ the four elements of a finding to discover if there is any “gap” between actual performance and what must or should be happening,  persuade the reader to take action, and diagnose any problem to develop helpful recommendations.

5.    Select relevant, valid evidence to provide the "proof" for the answer to the audit objective.

6.   Design/organize reports to benefit the busy reader; put the main point first. Use message-style headings and sub-headings. Make the report reader-focused.

7.   Control paragraph unity (one main topic) by developing strong topic sentence. Ensure paragraph coherence (flow) by developing strong and obvious linkage between each sentence in the paragraph. 

8. Write sentences with strong sentence cores where the subject of the sentence is the main idea and the verb conveys the real action of the sentence. Be aware of and control other common sentence problems.

9. Use plain English whenever possible.

10.  Learn and use correct grammar and punctuation.

We’ve never seen a perfect audit report. No one has. Almost always, the perfect is the enemy of the good—reports need to be released into the world in a timely way to stimulate change and so good is good enough. While we do provide best practices and some templates for reports and report components, we leave it to each audit shop to devise the overall format and approach that best suits its work. However, we have very strong opinions. For example, the main point should always be up front where it is easy to find. The approach we take throughout this book is informed by best practices we’ve observed during our 30+ years of working with auditors in constructing effective audit reports and by the Generally Accepted Government Accounting Standards (GAGAS) as outlined in the Government Accountability Office’s Yellow Book.

The techniques we discuss can also improve non-GAGAS-compliant reports and internal audit reports done within companies as well. Most of the techniques can also help to improve “working papers” of all kinds, and we believe it's a good idea to use working papers to practice the audit-report-writing techniques you will learn.