The Grandfather Dialogues
How Do You Make Oral Reports, Grandfather?
by Larry Sawyer
IIA 1974



"First tell me how you make an oral report, Grandfather."
"Like two porcupines dancing a polka."
"What do you mean?"
"Carefully."


How Do You Make Oral Reports, Grandfather? (Chapter Sixteen)

Remember when we were talking about internal audit reports, Grandfather?

Yes indeed. Must have been a month or so ago, Randy.

You told me some things that seemed kind of strange.

For instance.

You said that reports could be written or oral.

Right.

You said reports could be made at the beginning, the middle, or the end of the audit - and in some cases all three.

Right.

You're going to have to prove it to me.

Be glad to, Randy.

And I'd also like to know how to make oral reports.

Fair enough. Where do we start?

First tell me how you make an oral report, Grandfather.

Like two porcupines dancing a polka.

What do you mean?

Carefully.

Very funny. But why carefully? Can't you just go up to someone and talk to them?

You can if you're just trying to develop some facts or if you're trying something out for size. Then you can be informal without too much preparation - except that it's always nice to know what you're talking about.

What's the difference between that and an oral report?

When I say oral report, Randy, I'm talking about a planned presentation to a manager or to managers for the purpose of telling them something they should know or getting them to take some action.

Why do you have to plan an oral report?

Okay. You tell me. What's the prime objective of the oral report?

To get information to management right away.

Good. What's the objective in making any presentation?

That's tougher.

Think about it a while. You're coming to a busy manager's office and you want him to hear you out. What's the objective?

Oh, I think I see - to get his attention.

Fine. What else?

To make him understand what you tell him.

You're doing great. Finally?

To get him to take some action.

Excellent. Now, could you accomplish those objectives with a rambling discourse?

What's that?

An informal conversation that jumps all around the place and doesn't ever get anywhere.

I guess not. So what do you have to do?

First you have to remember that you're a professional and that whatever you do should be done in a professional way - with style and class.

You mean put on a show?

You bet. Remember what I once told you?

Yes, nothing ever happens until somebody sells something.

Right on, my boy. So your oral presentation must be as carefully planned as a sales presentation.

Tell me how.

Very well. And we shall discuss oral reports at the three different points in the audit: The beginning. The middle. The end.

I'm listening. But what in the world do you report at the beginning? You haven't done any actual testing yet.

True. But you have done some thinking. You have looked at prior working papers. You have looked at organization charts. You have found out what people are supposed to be doing. You have read operating reports. You have made a preliminary survey. You have talked to people. You may not have done actual testing; but you already know a lot about the operation and you've got a good idea about how you're going to prepare your audit program. So why keep it a secret?

Why not? Is an auditor supposed to reveal his audit program? Isn't he supposed to keep it to himself?

That's for the dark ages, Randy. In the absence of suspected fraud or sensitive areas like cash, the modern internal auditor likes to get the operating manager involved in the audit as soon as possible.

Why?

It develops trust. It shows the manager that the auditor is not underhanded. It removes the audit from a cloak and dagger operation to a -

I know, Grandfather: A problem-solving partnership.

Good! You do remember what I tell you.

Sometimes. Especially when it makes sense.

I don't know how to take that, but never mind.

Okay. How does an auditor prepare for an oral report?

He and his supervisor work it out together. They decide what things need to be covered in the audit. Then they briefly outline them on flip charts.

What are they?

They're visual aids.

Come again?

They are a way of getting people to focus attention on the presentation.

Why?

They help the listener concentrate on what is being said. People's minds tend to wander when they just sit and listen. If they have something to look at they remain interested.

How are these visual aids prepared?

In several ways. They can be put on view-graphs, which are thrown on a screen like a picture slide. They can be put on large sheets of paper or cards and put on tripods. But the system I like is much simpler.

What is it?

I write brief notes with a felt pen on ordinary paper - 8½ by 11- and then put them on a little stand that looks like a tent. Actually, it's a three-ring notebook with an extension to one of the covers. The extension forms a base and so the tent doesn't collapse. The sheets of paper are put on the rings. Then, as you're through with a page you just flip it over. That's why it's called a flip chart. The stand can be placed anywhere because it's small and compact.

What does it look like?

Something like this. The first view shows the empty notebook laid flat. The second shows it set up like a tent, holding some flip charts.

That should be pretty easy to use, Grandfather.

It is. And it can be purchased in any good stationery store. When you get used to working with it, it's really a breeze. First, I write out what I want to show on the flip cards on 3 x 5 slips of paper. They are my rough drafts. Sort of miniature flip charts.

Why so small?

So that I don't write so much. That's the biggest trap for the beginner. He writes too much. All you need are key words and phrases. Otherwise the charts get too "busy." Then I draw light pencil lines on blank, white 8 ½ x 11 sheets of heavy bond paper, just to keep my words straight. Finally, I print freehand with a felt pen. Even if you don't print too well, it still looks good.

Do you write out what you're going to say as you turn the flip charts?

You bet. Nothing is left to chance. I have my accompanying narrative on sheets of paper or on little cards. Actually, although I make notes on the talk in advance, I rarely have to use them.

Why?

First, by putting my thoughts about the narrative on paper, I know where I'm going. Second, the key words and phrases on the flip charts give me enough of a clue so that I seldom have to refer to my notes. But I keep my notes on my lap anyway, just in case I have a momentary lapse or if the narrative is interrupted.

Do people like these presentations?

Yes indeed. And for various reasons.

For instance?

They see the auditor in a new light.

What do you mean?

First they see that he is willing to be open and candid with them. That he's holding nothing back. That he's cooperative and aboveboard.

Then?

Second, they begin to believe that he means it when he says he wants this to be a team effort and that he's not just sneaking around looking for deficiencies to report.

What else?

Third, they believe him when he says he'll bring anything of importance that he finds to the attention of operating management.

Any more?

Finally, they see that he's a professional. That he has prepared thoroughly for the meeting. That he already knows a good deal about his subject. That his flip charts show thought - but yet are economical. That he has grasped the essentials of their operation in a short time.

Who do you invite to the conference?

My feeling is that you should include as high a level as possible. The operating manager, his boss, and maybe his boss's boss. I'd even suggest that the operating manager also bring the supervisors working under him to the meeting.

Why such a big deal, Grandfather?

Remember, my boy -

Yes, yes, I remember: "Nothing ever happens until somebody sells something."

Exactly. This is your opportunity to sell your product. And it's a fine product. Besides, it's much better to sell something than to ram it down somebody's throat.

Are there any benefits to the auditor?

You bet. These managers are very interested in the audit. They'll show it by their questions and by the way they pay attention. The supervisors with whom you'll be working will see this interest and the auditor's stature will grow quite a few inches.

Is that good?

Good? It's great. The auditor will find that he's getting more respect and cooperation than he ever got.

Really?

Absolutely. I remember one job not so long ago where the auditor went out to gather some material before starting his work. The manager he introduced himself to was rough, tough, and antagonistic. The auditor came to me puzzled, hurt, and wondering how to overcome this attitude.

What did you do?

I set up a conference with the manager, the manager's boss, and the boss's boss. The auditor and I developed a careful presentation, with flip charts, setting forth what we proposed to cover. Then, on the last chart, we listed the deficiency findings we had reported in the last audit report.

Did everyone attend?

You bet. The presentation was a complete success. The tough manager started off with a couple of snide remarks. But gradually his attitude changed. And when we came to the last chart with the prior findings, his own bosses showed keen interest in them and asked him what he'd done to make sure the deficiencies did not recur. Pretty soon the tough guy got the notion it would be better to switch than fight. During the entire audit that followed he was completely cooperative and friendly.

How about his bosses?

They were very appreciative of our presentation and told us so.

But isn't this sort of thing a lot of extra work, Grandfather?

Not really. In fact, it saves time.

How?

When the auditor and the supervisor know they're going to make such a presentation - in effect an audit report - they immediately dig into the problem in an organized fashion. The auditor just doesn't go out and haphazardly look at this and that. He makes a sound analysis of his job - and his supervisor works right with him. So in the long run it makes for a better and more economical audit - there's less fumbling around.

Do you make reports like this during the middle and the end of the job too?

Yes indeed.

What do you report during the middle of the job?

During the job you might report real significant findings and recommendations. Matters that are a little complex. Matters you want completely understood and acted on. The flip chart presentation makes it a lot easier to get your ideas across. Also, if you have a complex job stretching out over many weeks, it's good policy to give management a progress report on what you've covered and what you've found - the good and the bad. They appreciate it, and putting the presentation together helps you collect your thoughts and look objectively at what you've done. Besides, it gives management a chance to ask questions - questions that might give you some new insights and even get you to reevaluate what you're going to do on the rest of the job.

Can't you push this sort of thing too far?

Of course you can. You have to use judgment in this as in anything else. You don't overdo it. You wait for the right spots. But when you know that management would be interested or should be interested, you make your carefully thought-out presentation.

How about at the end of the audit?

Absolutely.

Aren't you going to have a written report at the end of the job?

Sure. But written reports take a little time to get out. In the meantime people are very anxious to hear about the auditor's overall conclusions. Besides, the oral report has another beneficial effect.

What's that?

When he makes his oral report, the auditor tells about what he did, what he found, what was fixed, and what still needs to be fixed. The top managers sitting in on these meetings get very interested in what's still to be fixed, and they make sure that something is done about it right away.

How about written reports, Grandfather?

What about them?

Are they hard to write?

That is a very large can of beans, Randy. Let's leave it for another time.

Okay, Grandfather. Then you can give me an oral report on written reports.


Audit Wisdom