obviously, knew a lot. unlock a lot of these expeditions which they said what are these guys can what do these guys know? we will do it our way. so thanks for your question. one more question. >> with a good knowledge of what happened to melville afterwards. to ever knowledge of what happened to the other survivors, how they progressed? >> we know exactly what happened to the budget to read the book. [laughter] you can be one of two things. you need to read a book or you can just read "the new york times" review that was in sunday's paper that was her plot summary. everything who lives, dies, where, when. but i'm very careful about this because i found that an leaders found that an leaders have told me last when the pictures are a lot more powerful and moving and haunting and meaningful if you don't know. this tour is just obscure enough and the way it all plays out it has a certain power if you just don't know. so don't google -- you can google it.

this is nonfiction and mississippi and it happened and you have to know you can do that. but i would encourage you not to. i would encourage you just to go with the flow. the last 100 pages go by pretty quickly i think they are more powerful if you don't know. thanks for your question. >> are you where the smithsonian holds some jeanette artifacts speak was yes. yes, i do. have you seen them? >> yes. >> at the navy academy, at the smithsonian. out of the national archives has some stuff. there's some stuff in san francisco as well. but thank you so much. thank you so much for coming tonight. i'm going to sign some books down here. [applause] >> hampton will be appear signing. please fold up your chairs and leaned them against something solid. thank you. [inaudible conversations]

>> interested in american history? watch american history television on c-span3 every weekend. 48 hours of people and events that helped document of the american story. visit c-span.org/history for more information. >> coming up next on booktv, richard chambers talks about his 40th or as an auditor for both business and government, including his work with the tennessee valley authority, the u.s. postal service, and the u.s. army. this is about one hour. >> thank you, leon, and it's great to be with you all. this was my home chapter for a number of years, and delighted to be back and be part of your

program. the first odd it conference that we have done with washington chapter for government auditors in a number of years. so we are excited to be back and excited to be part of program today. this morning i'm going to share with you some reflections on a career in an internal audit. next year will mark 40 years for me in this profession, and the vast majority of my career was spent in government. and i was asked about two years ago by some of my colleagues with the research foundation of thought might be interested in sharing some of my experiences in a way that would help internal auditors across a spectrum of their career from entry-level to heads of internal audits and governments come into government sector, even inspectors general, help them with some of the challenges they might encounter by sharing some of my own experiences, life-based stories if you are

from this profession of government auditing and intro auditing. so this morning i would just say my purpose is to give you a quick overview of the stops i made along the way and then share with you several key lessons that i've learned that i think you might find applicable in your own careers at some point. as some of you know i start my career in the private sector, worked very briefly with a commercial bank before joining the gao. i was over at the gao headquarters yesterday to meet with the comptrolle comptroller, and walk in there was very nostalgic because is almost 30 years ago when i first walked the halls of gao as a young trainee their in the offices on g. street. i didn't spend along with gao. then he moved over to the army and served in the army civilian interval our program, the

internal review program, was that really a sizable chunk of my career. and i moved back down from washington where i had come, move back to atlanta and i spent the next 17 years moving up the ranks in the internal review organization at headquarters forces command which is based in atlanta at that time. over the course of those years i had an opportunity to serve at every level from what we called at the time -- a trainee, right up to the chief at force, which was a 4-star command and osha a couple of my expenses from those years with you over the course of our time together this morning. after 17 years there in atlanta i decided i wanted to try my hand at work here in washington again. so i moved my family back here and i joined the pentagon were i was the director of internal review for the army. at the time almost 1400 auditors

based in 300 locations around the world that helped to provide oversight for. those were exciting is, very challenging years because they were immediately after the downsizing following the fall of the berlin wall and the so-called peace dividend that was being sought from the department of defense. a lot of pressures from a budget standpoint. after four years at the pentagon and i moved over right up the street to the u.s. postal service is inspector general office. it was a process of setting that office up, postal ig had not had an office historically. congress mandated a new inspector general organization there in the mid 1990s, so i moved up there to help the ig was putting an organization together. spent in the next three years as part of the postal ig organization, becoming the first deputy ig for the postal service. then i moved down as i will talk

about later, move down to knoxville while where i serve as inspector general for the tennessee valley authority, and the following turn of events regarding the ig act and the reclassification of the position, presidential appointee, i took a early retirement and went with the iia at a bin with the institute of internal auditors twice over the last 14 years, and in the middle i spend the fighters that's the national leader for pricewaterhousecoopers. over the course of my years i've had an opportunity to work in internal audit and ig work within government. i've had a chance to work in the not-for-profit sector, and if also had a chance to work in the corporate sector, via one of the big cap accounting firms. overlays been an exciting career and i think i picked up more than a few anecdotes along the way that some of you will find relevant here this morning. with that let me share with you some of the things that i've

learned that i think regardless of where you are in your coverage of either have encountered or you're going to likely encounter the lessons that auditors in government invariably have to address. the first one is really that stakeholders judge our value. interim auditors and government auditors definitely have stakeholders but it took me a while to figure that out. i assumed that we are there because there was an army regulation that said that we should be there. audit activities were supposed to be organized and every command around the world, this intro program put in place since the end of world war ii. i didn't have any question that we had a place to be because the regulations mandated it. it wasn't until i became the director of internal review for the army right after the fall of the wall in the end of the cold war, there was a lot of pressure on downsizing the military.

there was an expectation that we're going to save some money for the taxpayers. and what i discovered, assuming the role, director of internal review at the pentagon was that our resources out there around the world were being dramatically downsized. more dramatically than the army's budget. and some places we're seeing our internal audit department cut by 75% or more. certainly the budget and the military were being reduced but not by that much. so i spent about six weeks right after guided washington and joined the staff down the pentagon, spent about six weeks traveled around the world and talking to military commanders, two other militant officers and two others within arm activities around the world about what was it that was not delivering, that really caused them to make this very difficult decision to reduce the staffing. i heard a loud and i learned a lot, and it was probably the

most rewarding experience from a learning standpoint that i have encountered up to that point in my career. what i heard was stakeholders, those relied on internal audits were making very difficult assessments of the value they were getting. i would hear army commanders say i know how importan important ih in interval audit function. i understand the value that they can provide me, but at this time i have to make very difficult decisions. i either have to spend money, i do have money i have to spend on family housing for my soldiers or audits. and i don't think it's a choice for me. i felt like that was a false choice because i thought what they were really doing was as one of the army generals later pointed, they were eating their seed corn because if you get rid of your audit capability at a time when you got to figure out how to reduce your resources, you've taken away the very people who are going to be there to help you do that.

so i heard other stores as well. i hear commanders say the audits take too long. i need someone who can come in here and tell me what time it is, but by the time i get an audit report they're telling how to fix the watch. i heard them talk about that, the auditors were not focused on the real issues and challenges. i heard them talk about the fact they needed quick decisions, or quick information or speedy information for decision-making. so i came back with a really keen understanding that the decisions that were being made by those who are making the investment in audit was that they were having to make that assessment based on what they judged the value of the function to be. it really helped us to formulate our own strategy over at the pentagon for how we were going to reengineer our internal review organization at the time. today when we think about stakeholders in the corporate sector or even in government we are often talking about audit

committees who represent the board and interaction with internal audits. we are talking of executive management. if i'm in the ig community i'm thinking about the executive management of my agency but i'm also speaking about in the ig community, for example, i'm also speaking about congress and the fact i have these competing, or not competing always, but these dual reporting relationships. we're speaking about operating management within organizations, within our agencies. we are also speaking but citizens and taxpayers and others. we have a vast portfolio, stakeholders with the we have to interact to address. some of the common stakeholder concerns that we do, and this is true whether we're speaking about government or we're speaking about the corporate sector is about the auditors don't understand the business, that we don't understand what it is that they are trying to do. we heard that a lot in the early years over at the postal

service. because the postal service had been in place for almost 200 years before the ig organization was created. and postal officials were not all that excited about the idea of having and ig, given the board wasn't all that thrilled with the idea. and so what we often heard as we start to conduct audits there was this is a little bit complex, it's too complex for your guys to understand. you don't have the expertise. you don't know or understand the business. i think we do that a lot today. you're going you that much more frequently when you're trying to audit operations manual hear it if you're auditing things like financial assessments of financial controls or compliance issues. you're much more likely to hear complaints about not understanding the business if your doing operational auditing. there's also this enduring concern that somehow as internal

auditors were not the most effective communicate. they're not talking strictly about the written product, although sometimes i feel like those are too voluminous and that they're very difficult for management to make their way through them, but they're talking about the regular and interactive communications that we should be having throughout our audit processes. they're looking for assurance but they're also looking for advice. you're looking for insight. because in most organizations with more expertise on controls and risk management than they do, and they're looking for us to tell them at the outset and initiative or while an initiative is being undertaken, they're looking for insights on the. i had the opportunity my years at the pentagon to serve on a reengineer and project of the travel program for the department of defense. i wasn't there as an audit of the i wasn't in of them to vote but i was there as a senior

official for making decisions about cutting controls and streamline processes. i was there to offer my perspectives about which ones, which controls were critical and what the risks would be if some the key controls were eliminated in the interests or in the name of speeding up the process. finally, we are also hearing even today the same thing we heard 20 years ago at the pentagon, we are hearing about the value for money. these are enduring challenges whether in the corporate sector or in the public sector. the second of the lessons that have on to share with you is that about building and sustaining relationships. unlike our external audit colleagues who tend to be a bit more nomadic, they will serve

for a while and then move on, perhaps to give the client. they serve one client from external audit standpoint and then they move to a different one. unlike them went to live where we work, and that's true whether we are auditing government or in the corporate audit world. we need to be in the organization, and our mission is to be within the organization and to be organized within the organization over the long term. i'm going to die from my experiences over the course of my career, those who are more successful why the agreement ig model or whether you're in an internal audit in government model or an intern at model in the corporate sector, those who are more successful in building and sustaining relationships within the organization, notice i didn't say cozy relationship, i'm talking about relationships, the ability to communicate, to have a degree of trust and interactions. those were able to do that are far more successful. when we speak about relationsh

relationship, that's what we're talking about here, we often talk about the importance of being able to demonstrate a positive intent. there's a suspicion sometime within federal agencies and within other government agencies across the nation that somehow the auditors are here to get us, the gotcha mentality. i think we have to be able to demonstrate that we have a positive intent. that we would want the organization to be successful first and foremost, and that that common interest that we share with those who are in management or leadership positions within the agency. we have to be diplomatic. invariably we're going to have to deliver difficult news, we know that. no internal auditor will serve very long in their career without having at some point say look, things are not well organized, controlled or not working. something is going to have to be

communicated at some point that management doesn't want to hear. i would tell you the ability to do that diplomatically and in a nonthreatening way will often be much, you will benefit from it much more in the long run. foresight, the ability to help management understands what lies ahead on what lies around the corner. i'll come back to this concept of foresight later on. trustworthiness. this is one of those characteristics that i think we have to be able to demonstrate. there has to be a perception on the part of management and the part of agency officials that we can be trusted to do the same thing every time under the same circumstances. leadership. and empathy. these are all characteristics that i think we have to be able to demonstrate. i think relationships can also enhance, relationship action can also enhance your value and can actually help you be more successful over the course of your career.

when i went down to tva as the ig, i loved postal service and went down to tva early in 2000, i got there and was one of come under the ig act at that time, was appointed by the agency had, or in our case, the board. so the board of tva offered me the position and went down at i assumed the role of the inspector general. for a lot of reasons that i won't get into there was a bill working its way through congress to amend the ig act and make the ig position at tva presidentially appointed. i understood the risks when i went down. i did things that we might have a little longer before the bill was enacted, but sure enough i only been there a few months and there was a rider attached to some omnibus legislation out at the end of 2000. it was actually why the election was still hanging in doubt, and it actually did make that a presidentially appointed position. there was a provision that said

the incumbent ig can stay in that post until the president is elected to make an appointment. i needed to have at that time 25 years in able to take early retirement. and so i just thought this is going to take a while. new president coming in to whichever one it was, it would take a while to work their way down the list to the tva igs position and sure enough it did. but the next summer, the summer of 2001, i was traveling out of town and i got a call, and it was director of presidential personnel calling on the off -- on behalf of president bush. he said the president has elected to make an appointment. let me take just a bit of the back story. i one time you that, once i knew what was pending and the act had been passed i figured i'm going to be the best job i can hear and whatever happens happens. if i retire early and go do something else, that's fine. one of the things i did was to

work very, very hard in those ensuing months to build some strong relationships on the hill. because tv is service areas spans seven state. with 14 senators and 20 house members who have jurisdiction over some part of our service area. and i spent at least one or two days every month coming to washington from knoxville and i walked the hill, walk the halls of capitol hill meeting staffers, meeting members of congress, listening to their concerns to making sure our audit plans would address their concerns, being responsive if they had concerns about something tva was doing. i thought that's what i needed to do to be an effective ig. so when the call came in the summer of 2001, and the voice on the other end told me that the presidenpresident had decided te his appointment at tva, my assumption was that they'd gone through a vetting process and they're going to be naming someone who have been nominated

or who have been put forward by a member of congress. size very surprised when he said, i asked him, i said okay, who is the nominee going to be? and he said the president has decided he would like to nominate you for the position. and i said meet? you know, career civil servant, i've really never indicated an interest in the post. he said we've been talking on the hill and almost everyone that we've spoken with, all of the key senators who have jurisdiction over the area, they all want you to stay because they feel like they have a strong working relationship with the. i guess i would simply say that was not my intent and it was the furthest thing from my mind would be to be able to build relationships i was about get the nomination, that that is, in fact, the way things worked out. so building and sustaining relationships will make us stronger in almost every post that we hold in the course of your group as a discuss in the book after a lot of soul

searching i finally did decide to decline the opportunity and to take the early retirement, but it certainly was another important lesson for me about why it's important to build sustainable relationships. i think it's also important, and this is something i think in government audit we've got to really make a priority, is to follow the risks. we really need to follow the risks were evidently this because if we have learned anything about risk in the last 15-20 years, is that they are very dynamic. the winds of risk shift very rapidly. we were first starting to experiment with risk assessment and building our audit plan based on risk assessment during my last year's at the postal ig. i remember the ig and i the first to put a risk assessment together was literally on the back of a napkin and we use that to help us decide where some of our audit priority should be in the coming year. when i left, by the time i left

postal to go down to tennessee i thought yeah, i know, i got, i understand risk and risk assessment. so i showed up probably my staff will tell you i showed up somewhat arrogant thinking i knew it all and i was somehow a new risk assessment a little delay understand, they got it and are much more adept at it than i. i showed up at tva and, of course, i knew that tva at nuclear power plants across the tennessee valley and my assumption was those nuclear plants presented the greatest risk so that would be at the top of any risk matrix that we put together. after a few days of being school in what risk assessment really was all about i discovered that the real risk of tva wasn't a nuclear plant. it was the coal and acquisition of coal and other fossil fuels. because that's where the vast preponderance of money was spent, and by the way, while there might be high impact of an

event at a nuclear plant, the likelihood was significantly mitigated all the controls and all the oversight on all the other agencies that had a role to play. so i learned very quickly that risk is really two-dimensional. it's really about impact, but it's also about probability or likelihood. you have to take both of those into account if you're going to be out there in this environment trying to decide what are the risks and where she we dedicate our audit coverage. i learned early in my perhaps quickly the risks can change. i had become the chief of intruder review down that forces command and early 1999 and i was so proud that i took my first audit plan together for the coming year and with all of the audits we're going to conduct throughout the command come and the chief of staff and commanding general were all aboard. and lo and behold in the fall of -- in the fall of 1989, saddam

hussein invaded kuwait, and i basically had to chuck that audit plan and spend the next six months being responsive to open the risks that were emerging. so we need to understand that when risks change quickly we have to adapt our audit coverage. some of the things we're hearing about in 2014, 25 years later, we're hearing about cybersecurity risks. we barely go through a week now that there's not a major cybersecurity breached somewhere in this country, usually with one of the brand name retail concerns. cloud computing and all of the vulnerabilities that are presented there. mobile technology, third party risk is becoming increasingly clear that you may have all of your risk control, but unless you understand out well-controlled your third party contractors and others are, you really don't know what your risks are. we also see the looming deadline

for coso 2013. does present a lot of risk for a lot of workstations to get compliance with that by december of this year. and then social media. all of these risks, many of which are technology-based risks, are driving audit plans and driving changes to audit plans in 2014. we really have to continuously assess risk if we're going to get it right. i've been using the expression lately, we've got to audit at the speed of risk. we cut to be able to adapt our plan based on what those risks are merging from. there are formal methods, informal methods, a lot of different ways they can update their risk assessment on an ongoing basis. but the point is we've got to be more agile and we've got to do more to do with the risks are and where they're coming from. the next lesson is one that i think is particularly appropriate, speaking with

government audit groups, and that is the whole challenge of time in his. we audit at the speed of risk but we also need to put our audit reports out at the speed of the need of information of our key stakeholders. i learned early in my career about how a late audit becomes totally worthless. in addition to being in charge of our internal audit activity at forces command we are also audit liaison for all these outside agents. in the peak of desert storm, for example, i think we had 140 ongoing audits from outside activities in our command. just think about that. i had a general once who said, you know, the navy says that the world is covered one-third by land and two-thirds by water. he said i think they got it wrong. is that i think is covered one-third by land into third by auditors. all of us i think are probably a part of that equation.

my experience my first took over that role sort of stayed with me over the years. we had a very complex and vast force structure at that time within forscom. we had units literally positioned all over the tiny. and we would get these audits in periodically -- all over the united states. a final report a moment is when they come and i look at and i whispered to me with our force structure to attend were all the units were but i couldn't remember where that battalion was based on the designation on the report. i called my deputy in and i said where is this unit with a sense combat engineer unit was established two years ago. and they said we're just getting the audit report.

he said yeah, it took them a while. so i think that's an extreme example, right? if you get it on after something ceases to exist, but it helps me to appreciate that we really got to stay on top of this. i've seen audits within my time with in government particularly, and i see it occasionally within the corporate sector but teens to be more pervasive in government, and take six months, a year. i seemed audits take as i said two years. let me tell you, once and audit starts to take that long, the value of the information contained in it goes down dramatically. we ar live in an era where peope can google something and find the answer in five seconds. if we are taking two years to tell management or legislators or others what we found, we really aren't delivering the kind of value that we showed. i've spoken about this and i thought about it and i've really been an evangelist for this idea being able to audit more quickly

for the last 20 years at least. i've talked about the fact that you need to streamline the planning phase of an audit. but you also need to dedicate the appropriate time because if you don't do your plan right, it looked like taking a trip without a roadmap for gps bigger going to get lost. i've talked about some of the techniques within fieldwork, getting out there leveraging technology, being able to be more efficient in the way we undertake fieldwork but i think it's also important. and then finally the reporting, the reporting face. it was actually larry sawyer, the father of modern interlocking said, few sources of friction within the audit department exceed that caused by the process of report writing but i think all of us in the probably bear a few scars from audit reports we try to get out and somebody disagreed with the wording. look, getting consensus with the audit department sometimes the stuff in getting agreement with the agency officials on the findings and recommendations.

i've talked about different techniques that can be deployed, the idea of sharing the results so you don't dump all of the odd results on management at the end of a process, of eliminating or reducing the levels of review. large audit organization can often have seven levels of review. amor levels of review you have on a draft report, the longer it will take to get it out. using an editor early in the process. we used to do report them to get them all the way up through the editing process and all of the auditors would agree and we turned over to an editor and they would take it all apart and start all over again. what we employed over the years at postal ig was a technique that i found to be effective and i've actually held a number of corporate clients about this over the years but it's this idea of teen editing. what we did is we would pull all of the stakeholders for an audit

within the ig. we pull them all together in a room and say look, this report is going to be finalized with all of us i in the room because we're not sending it to you and the u.n. and eu and then do you and take six weeks. we're going to sit in this room and edit the report together and put up on the screen and where all going to agree when we walked out that's the way that report should be worded. it would be a very effective way getting draft reports through the editing process. i can recall when we were able to get audit reports, draft reports into management and within a week after the end of fieldwork. it takes commitment and effort. it does take a little more time. i will to you that. we took on average about 30 minutes a page. i figured up on time it's taken about a half-hour of age to do it team at it. with all those people in the room you're spending a lot of staff time in the room to get it done but it speeded the audit a long and i all of us found it to

be a very effective tool in making sure that we were not late. the next lesson is one that i find them still find to be pretty fascinating and somewhat entertaining. in fact, "the wall street journal" ran the excerpt is an entire chapter on their website, their risk website a few months ago. because what i found and what i think resonates with people is that sometimes it isn't the really spectacular audit findings with respect actually result in our audits that generate the most reaction. people sometimes can resonate things that we think are relatively insignificant are relatively minor observation. i remembered the first expense i had. i was a young author doing an audit added california. we're just getting ready to set

up as a national training center. i was out there auditing with a team and we're looking at all the processes that we were employing. i was doing an audit of the contract processes, the process by which we are identifying requirements and acquiring supplies and materials. and i use as an example, i used as an example that it ordered more trash cans and we're going to soldiers and civilians stationed to obviously not a good requirement determination, right? i remember i just use it as an example in the report under member what it costs. in fact, i remember the contracting officer just almost with tears in his eyes thing you are going to get me fired with that report. and i thought to myself, that really wasn't that big of a deal. but what it did was resonated with other officials and with those who were responsible for overseeing the area. and so it was a big deal to them. a few years later i had another

example where i discovered, i went to look at one of our subordinate commands and we got some money from our command to help deployed soldiers to desert storm. and i went in and i looked at whether there was any goldplating. we call the goldplating. did they give money that they use for their own improvement, for the on operations. i discovered while i was there i observed they number of new telephone poles lying in a stockyard, and they did all the more inquiry and i found out those are paid for by our command but were being, they never got shipped over to the middle east and they're going to be used in the future to help the operations within the command where i had visited. and i made an observation that it was an informal observation back to my chief of staff. make a long story short, it just blew up. i had his two star general at the of the command but just thought i'd done the worst thing in the world to accuse them of

taking advantage of the funding model. and he said i di didn't know the first thing about warfighter, which i thought was amusing to i've just come out of the army war college. i did know a little bit but i did no goldplating when i saw. anyway we have to realize sometimes will get people's attention and really fire them up. i remember when i was at the postal service and we didn't discover this but we got cold and very quickly to look at it. i was driving into work one morning and i heard on the news that the postal service had acknowledged it had printed some 200, 300 million stance, first class stamps honoring the grand canyon an unidentified the grand canyon as being in colorado. it set off a firestorm in arizona. and actually here in washington. how could such a mistake had been made? so it's a little things sometimes the really to generate the most excitement. i think we have to realize that when we put our reports together. waste and inefficiency resonates

big. i think some of us have been around long enough will remember $600 hammer and the toilet seats and all of the examples i got circulated back in the 1980s. down in tva we did an audit of the refurbishment of the chairman's office of the national and identified some extravagance, expensive furnishings. we didn't call them extravagant to we let the public make that call but we found a very expensive patch class that did and put up in the room. we found one of the libraries have panels of custom milled wood that had been purchased from the plantation, i think the cost of handling that library was almost $300,000 it was leased space. so that just generated a

firestorm of publicity across the valley. i think we have to stress that magnitude in reports so that we don't give the impression that something is more widespread or worse than it actually is. don't sensationalize. the press and others will do that for you. and be prepared for the reaction. my favorite story is the study at home project when i was the idea tv. we got a call a legend that some tva employees were using their personal or using their business computers. they signed up for this study at home, search for extraterrestrial intelligence at home. the way it worked what your computer, he signed it up and you got a very neat screensaver come and while you weren't using your computer somehow the university of california, berkeley or someplace was able to sort of tap into your computer and use its capability to assess radio waves from outer

space to see if there was any signs of extraterrestrial life. we found only 19 instances of it at 13,000 employees, and we made a minor note -- welcome we conducted this investigation, made a minor passage in a semiannual report to congress, ma and the roof came off. it made the news in australia. so i will just tell you, things will go viral. that was in the early days of the internet. nowadays it would go by much faster come and i don't know it could get much further from here to australia, but these are things i think all of his have to keep in mind is a small stones can sometimes cause the biggest waves. i also think we have to recognize that no one is immune from -- including those of us in the audit profession but just be aware of your blind spots. when i look at apple goal -- epic lapses, i've seen several

trends for themes, loyalty senior executives. i think there were allegations tossed around a few months ago but one of the acting igs here in washington who is being accused of becoming or maybe being too close to some of senior executives in the organization. desire to protect the organization. sometimes things don't get reported because we don't want to embarrass our own organization but that's never worked out well by the way. topics of interest and just disregarding codes of ethics. those ethics or view the iia or the corporate code of ethics or within your own organization. when i think about on its leaders i often think about, excuse me, i often think about their honest. it's very important that people perceive that we are honest and we're not doing something devious or illegal or illicit on our own. courageous. courageous audits. i think went to be as auditors,

government auditors courageous. accountable. empathetic protecting but also as i said earlier need to be trustworthy. i think you've got to be respected and you've got to be proactive. i remember early in my career as a chief auditor, head of internal auditing forscom, my first act of courage was probably more out of foolishness. we had a situation there at fort mcpherson where we discovered that we had a fitness center that had been built at the cost of it exceeded minor construction appropriation dollars. at the time you could only build something for a bout come up to $250,000 without having a separate appropriations for the construction project. and what it happened, and i'm sure we've all encountered it, is contract splitting the what they did is they built three different wings and the conduct of them together by a common hallway and saw the each separate projects.

and so we wrote that up in the report and it sort of, the roof came off. nobody was really happy with us about that. the chief of staff decided we've got to convene an investigation because we may need to have, there may need to shrink there may be a court-martial here if someone has intentionally violated the law. i we were sitting down with her head legal guide. i was of course a civilian. i was 15. he was either a very senior full court or even a general. and i was talking to we have monthly meetings and he was telling me, this was right after this audit report had come out, and he was telling me that one member of this team was going to be conducting this investigation, this potential court-martial investigation. without thinking, this is kind of like as i said courage through naïveté i think. without really thinking i just said to them, i said, colonel, argento, i can remember, colonel, do you think your staff

can really do that because they are the ones who advise these process -- these projects be approved? he kind of looked at and nothing more was said. a few days later i was m me with the chief of staff andy told me just a matter of updating on a number of things that the jag has decided to transfer that investigation. i sort of looked a little puzzled. i said i thought they're going to conduct the investigation. the general looked at me and winked and he said apparently told him he had a conflict of interest. i think sometimes you be willing to do something like that because courage i think is what makes us effective in our role. i had another story to share here on this one. i got a call from one of my subordinate audit heads when i was done it forscom and she was telling me that the i.t. department on her command had invited or had asked her if she

would detail the internal auditor for her own organization or just an audit in the i.t. area, which detail the over to help implement the recommendation. because the recommendations were going to streamline some of the processes and would like the result in a need for fewer staff than they thought the staff would not be as enthusiastic about implementing those recommendations. we had a long talk about it and my advice was not too. i said i don't think you should. i said the government audit standards would indicate that you're not going to be able to go back in there and the objective and during subsequent audit works i don't think you should do. i thought that was the end of the conversation. a few months later i get, said in my office etiquette is very official looking document, and gets a subpoena for me to appear before a federal labor relations judge in texas to testify about the propriety of using internal audit staff to conduct work for

management, specifically the internal audit staff of the army installation have been used to implement corrective actions in the i.t. area, and the local union has filed a grievance. or a lawsuit. so i got on the phone and the culture and i said i thought we talked about this? i thought you were going to do this. she said i wasn't, but then he offered me all new computers if i would send her over. so we just have to be careful because at that point of course would've been very difficult for them to have been perceived as having the objective later on. final that we just talked with this concept of a seat at the table. auditor say we need have a seat at the table. we need to be there when management is considering, when management is looking at new strategies or in limiting new business initiatives so we can

understand what they were considering, so that we can offer o our share our insights. we really do need to understand business strategy formulation, and being in the room makes it much easier. we do need to understand how management processes and implements risk and implements controls. we can't be seen if we get a seat at the table, if we're in the realm when management is having these meetings, we can't be seen as using our time there to get audit leads. it really is a means. the seat of the table is a means to be more effective as auditors in the future. it's not an in that somehow we have a right because we're in the realm sitting there with management. i think trusted advisors are always welcome at the table. i remember when i first became the ig at tva i remember talking to the ceo at the time and same i'd really like to attend a regular monthly meeting, their monthly staffing i believe with

the board and all the senior executives at tva at the time, know the ig before but had never done it but all the ig's what precedent had also been from a cruel investigative background. so there wasn't the kind of harmony i think that perhaps you can achieve if there's a perception that there's no out to get you kind of concept. and i remember having this dialogue and the ceo just recoiled at the idea that i would come to these meetings. he said you can't be there. he would have a chilling effect on the conversation. nobody is going to say anything if you're in the room. so we went back and forth, and finally i convinced him to let me, periodically. i think we agreed company, i could have forced it perhaps it wouldn't have been good to force my way in. we finally agreed i would come maybe every two, three months. i remember the first time i went to the meeting, it was kind of

like, i was the elephant in the room, right? so i opened up the conversation with them by letting them know i wasn't there to audit. i wasn't in there in my role as, wearing my ig i'm going to get you have. i was there to really understand what are the issues, what are the risks, what are the strategies so i could share with them in the perspectives i might have. i used the analogy that a seat at the table is like going to a potluck dinner. if you show up without a dish from your probably not going to get invited back. i think as auditors or inspectors general are members of the ig community, if we do have a seat at the table it's important that we go in with the right attitude, and share what we can. we are not going to be sacrificing our independence or our objectivity by being a decision-maker, or participating in the decision-making process, but it can be very valuable insight. i talked about the idea of the

trusted advisor. obviously, that becomes more difficult in some the statutory roles we play but i believe trusted advisors really are the results of at least two different dimensions. one is relationship we talked about earlier. build and sustain strong relationship to the other is just how well do you understand risk control, governance, how well do you understand the enterprise of the organization. it's only -- only then do you really aspire to the top of that grid and become the trusted advisor. while i realize i've gone quickly to some of these lessons, the book is more replete with them. i appreciate the time with you this morning, and i think we have a few minutes now for questions. so what i would like to do is just a these last few minutes and open it up and see if you

have any questions for me that i might be able to answer for you. >> would you say -- what are the similarities? >> i think, you know, i get asked that question a lot because i did spend a lot of my time in government and i worked with, i think 75 fortune 500 countries country and companies. i would take the similarities are much greater than the differences. there's an assumption because government doesn't have the profit motive and the corporate sector does but some of the completely changes the whole purpose and model of auditing. it doesn't come at the end of the day the thing we all have in common is that we're all trying to provide assurance on how well things are being managed, the overall efficiency and effectiveness of our organizations and adequacy of control. that's a common characteristic that auditors whether they're in

the corporate, not-for-profit or in the government space ship it to you think there some difference is but one of the differences obviously is that in the corporate sector you're using the internal audit function more as a training ground, a pipeline of talent to the company. ge has pioneered that process a number of years ago. a number of leading companies do that today. i think that there's also within government a tendency perhaps -- excusing from within the corporate sector to rely more on the risk assessment to build the audit plan. there are differences but there also thinks the government does much better. i think government audits came to have a higher degree of quality. they get in trouble with some of my corporate counterparts for saying that, but the time and the resources are often invested because the factory government audits are made public, that the risk of being wrong is much greater. if you make a minor mistake and

you're in a corporate setting and an internal audit report has a minor mistake in a, nobody knows outside of the company. if you're an inspector general or the gao and to publish a report with some in acted in a, it undermines the entire credibility so there's more time and resources and effort invested in government. i think government does a better job of training their folks because in many cases, particularly if budget warrants it, that's an important investment. other questions? yes. [inaudible] >> the biggest dilemma. i would say that, certainly from a professional standpoint the dilemma that i faced whether to stay at tva and take a presidential appointment or retire early, that was a very difficult one. it took me quite a bit of soul-searching to decide what i wanted to do. in a corporate setting, excuse me, in the internal audit

setting i would say there were a few dilemmas along the way. several of them touched on during my conversation your. one of them when i was at tva i was the ig, new to the organization, trying to establish some working relationships. one of the things i would get is i would get a regular report on the travel plan of individuals within the organization, anybody traveling outside the united states. there was a corporate starr report put together. monday report floated across my desk and it was, it indicated our chairman of the board was going to be traveling to paris and the rationale was to attend the paris air show. so we were at that time, we were just a lightning rods for congressional criticism because the senate was in the hands of one part in our chairman was in