1. Mark Salamasick CIA, CISA, CRMA, CSP Director of Center for Internal Auditing Excellence The University of Texas at Dallas For Houston IIA Chapter November 3, 2014 Where Will the Next Generation of Internal Auditors Come From? The Fight for Talent!

2. 2 Mark Salamasick, CIA, CRMA, CISA, CSP Director of Center for Internal Auditing, UTD – 11 Yrs. Adjunct Faculty, University of Texas at Dallas – 18 years SVP, Internet/Intranet Services, Bank of America – 2 years Director IT Audit, SVP, Internal Audit, Bank of America – 18 years Senior Consultant, Accenture – 4 years Instructor of Accounting and Information Systems, Central Michigan University – 3 years BS in BA and MBA – Central Michigan University Numerous IIA International Committees since 1990 currently on Learning Solutions and previously the Board of Trustees of the Research Foundation Four books published by IIA International Chartered and Past President of Two Toastmaster Clubs Recruited hundreds of entry level auditors for twenty years and trained hundreds of college hires over eleven years Enjoy running, road and mountain biking, traveling, speaking and financial investments

3. Agenda Past Present Future

4. PAST

5. Where have internal auditors come from in the past?

6. Quick Survey Where did you start your career? Public Accounting Industry Government Were you aware of the profession of Internal Audit at that time?

7. Quick Survey What job did you start with? Internal Audit External Audit Tax Something Else

8. Other companies Universities

9. Public accounting firms

15. IAEP gave me the tools I needed to start my career on the right path. The program is designed to build communication, risk assessment, and process design skills that are essential for any career decision. Kunaal Sarna, Microsoft The IAEP program at UT Dallas offers a variety a networking opportunities important for any career searching/planning including receiving offers for an internship and/or full-time position. Michael Callahan, Lennox International The IAEP program served as the foundation and gateway into a career that provides the fundamental knowledge of management, solid business practices and understanding of an organization in its entirety. I have leveraged that experience into other career fields and realized that a base knowledge of internal auditing is an invaluable tool set that is critical to the success of any project, any career. Cynthia Nguyen, UT Southwestern Medical Center

17. PRESENT

18. Baseline - Profile Group Positions Size of Audit Groups Size of IT Audit Groups Openings

19. Is this Realistic? Requirements Experience and Education (Audit Senior): Bachelor’s degree in Accounting. CISA designation required. CPA or CIA preferred. 3+ years of audit experience (Big 4/public experience preferred). 2+ years of IT Internal Audit experience. Prior experience in performing SOX-related audits. Prior experience in the financial services industry. Advance skills with the following Microsoft products: Excel, Word, Visio, PowerPoint, and Access.

20. Really? Job Requirements (Audit Senior): Bachelor's degree in Accounting or Finance, or similar business degree Minimum of 5 years of auditing experience in public accounting and/or a corporate internal audit In-depth knowledge of and experience applying audit principles, practices, and procedures Strong knowledge of Generally Accepted Accounting Principles (GAAP) and Sarbanes-Oxley (SOX) Ability to document, analyze and make improvement recommendations in processes and controls Proficient in Microsoft Office Suite Excellent verbal/written communication skills Ability to multi-task and adapt to changing organizational and departmental needs Ability to work collaboratively with all departments, management levels within the company, and external stakeholders Relevant certification such as CPA, CIA or similar Must be able to travel up to 30% of the time Operations, JDE, Hyperion and ACL experience a plus

21. This is more like it! Desired Skills and Experience MUST HAVE: Strong investigative and analytical ability required. Excellent consultative and judgment skills, confidentiality, and interpersonal ability. Must be able to communicate effectively with employees at all levels. Must have the ability to negotiate and influence results without direct authority. Thorough understanding of accounting principles and standards. Bachelor’s Degree in Accounting, Finance, or related field required (Master’s from an IAEP program preferred). Minimum of 5 years’ healthcare auditing related experience. Certified Public Accountant (CPA) or Certified Internal Auditor (CIA) required. NICE TO HAVE: ACL and/or IDEA experience preferred.

22. Have you looked here lately? Chapter Job Postings NRG Energy - Sr. Internal Auditor Location:Houston, Texas Date Posted:October 22, 2014 Date Ending:November 22, 2014 Swift Energy Company Internal Auditor II Location:Houston, TX Date Posted:October 14, 2014 Date Ending:November 15, 2014 Allegiance Bank Texas - Senior Auditor Location:Houston, TX Date Posted:October 13, 2014 Date Ending:November 12, 2014 Harris County Auditor's Office - Audit Manager Location:Houston, TX Date Posted:October 13, 2014 Date Ending:November 12, 2014 Harris County Auditor's Office - Manager Construction/Contract Audit Location:Houston, TX Date Posted:October 13, 2014 Date Ending:November 12, 2014 Harris County Auditor's Office - Senior Auditor Location:Houston, TX Date Posted:October 13, 2014 Date Ending:November 12, 2014

23. What is changing? Public Accounting Public Corporations Government Private Firms, Private Equity, and IPO’s

24. Increased demand More retiring More control-related positions More rotational strategies in audit groups More demand in other parts of company Higher level IT knowledge Decreased supply Public accounting Universities Other organizations Full employment

25. What is the Population of Schools Teaching Internal Audit? 82 US Schools out of 460 AACSB Accredited Universities 32 US Schools part of IAEP program Limited interest among Universities to start new programs Many programs are struggling

26. IAEP programs Orlando, September 2014

27. Three types of programs CentersComprehensiveFoundation

28. Centers for Internal Auditing Excellence The University of Texas at Dallas Louisiana State University University of Houston University of Pretoria Erasmus University Rotterdam University van Amsterdam

29. What have I noticed about Students? They don’t know where they want to work They don’t know what they want to do They don’t understand career alternatives in risk management They don’t all come in with the same backgrounds and perspectives They are eager to learn

30. Why New Programs Won’t Be Created Lack of a Champion Many barriers in starting new internal audit programs Marketing internal audit to students is difficult Some false starts in new academic programs Even current programs in internal audit will have difficulty staying at least status quo Potentially some schools teaching internal audit

31. FUTURE

32. Options for future staffing Maintain current staff Decrease staffing when auditors leave Recruit from other companies Recruit individuals in career transition Hire internal audit students from Universities Hire students from Universities Co-sourcing/outsourcing will increase

33. Future Demand/Supply of Internal Auditors Demand for internal auditors and risk management professionals will continue to increase significantly Winners will be those with staffing/recruiting strategy and long term outlook Losers will be those who recruit randomly

34. Other areas of the organization

35. Understand why people leave! Don’t like my boss Travel Career advancement – Promotion – Salary/Benefits – No room for advancement

37. Student volunteers(Unpaid) – Students want experience – Good way to test and gain experience Paid formal internships Full time while going to school

38. Winning the war for talent: Actions steps

39. Differentiate yourself

40. What are Internal Audit students looking for in an employer?

41. Survey Says

42. Opportunities for Growth and Advancement-19 Work/Life Balance-14 Competitive Salary/Benefits-13 Good Corporate Culture-12 Flexibility - 11 Diversity in Work-7 Constantly Learning/Training-3 Challenging Work-3 Recognition/Feel Wanted - 3 Great Leadership-2 Good Travel - 2 Highly Technical Environment - 2 Does the Board think Highly of Audit - 2

45. Continually network

46. Visit a campus

47. Speak to a class

48. How to attract students? Advocate the Profession in many ways Faculty/Staff Sense of Community (IIA/ISACA/ACFE Student Chapter) Cross discipline approach Lots of large events Create lots of disciples Scholarships

49. Advocate for Academic Relations and the Profession of Internal Audit Denny Beran How can YOU help? Advocate the Profession

50. Invest in the Future

51. Time

52. Talent

53. Treasures

55. Lack of new talent entering internal audit Shortage of internal auditors will get significantly worse Need to advocate the profession in many ways Very few new classes and programs Everyone in this room can help!

58. Getting started Building relationship with faculty Advocate the profession Mentor students Mentor those in career transition Class Presentations Student Groups Be an advocate for the profession in many ways https://www.youtube.com/watch?v=Zi1L-0wC7wA https://na.theiia.org/about-us/about-ia/Pages/Academic-Relations.aspx

60. For Additional Resources https://na.theiia.org/about-us/about-ia/Pages/Academic-Relations.aspx https://www.youtube.com/watch?v=Zi1L-0wC7wA http://jindal.utdallas.edu/centers-of-excellence/center-for-internal-auditing-excellence/ https://www.utdallasiia.com/