Chartered IIA: Brexit - ‘starter for 10 or 11’ for internal audit to consider now

18 October 2018

Whilst politicians cogitate and the media speculate, the organisations continue to operate and plan for an uncertain future. Brexit cannot be avoided. The Chartered IIA is preparing its research report detailing the Brexit preparations of audit functions.

There are decisions that cannot be made until the details of the Brexit deal are finalised but preparation and informed choices are imperative. Yet everything cannot be left until the 11th hour. Internal audit can help their stakeholders to shine a light in the darkness of the current uncertainty. 

In the meantime, here are some questions to get you thinking:
1. Brexit – preparedness audit

Internally:

• Internal audit needs to consider options - assurance or consultancy?
• The board should be independently advised on the organisation’s preparedness for Brexit and its current approach. Wait and see is not an option.
• What is the governance structure? Is it ad-hoc? Are there working parties and a programme of activity? Who is accountable?
• Has the C-suite considered the opportunities of Brexit?
• Is there a budget for Brexit activities? 

Externally:

• What is the impact on your customer?
• How are you keeping them informed and giving them confidence that you are set up well for scenarios?
• Where is reliable data sourced from?
• Has the impact on both the organisation and its customers been estimated for different outcomes?

2. Contingency planning/supply chain adaption

• Is it timely, effective and within budget and compiled by credible people to get to credible outcomes?
• What about additional warehousing to hold higher ‘buffer’ stock due to potential border delays?
• Are there innovative/diverse shipping options?
• How about alternative different supply chain models?
• Are there likely to be issues with talent retention contracts for senior non-UK nationals considering repatriation?
• What about upskilling colleagues?
• Will there be labour shortages (warehousing/agriculture)?

3. Third party management

• Where are they based?
• Have they been prioritised for business criticality?
• Which domestic partners could have a higher risk profile post-Brexit?
• How are you engaging your key third parties?
• Is joint planning appropriate and/or beneficial?

Full press release

© CIIA - Chartered Institute of Internal Auditors