Main Responsibilities of an Internal Auditor at Compass Diversified
Macartan's role as Internal Audit at Compass Diversified involves a "team approach" to auditing newly acquired companies, beginning with an initial walkthrough to understand "how they run their business" and assessing internal controls. This includes critical examination of system access and detailed testing of processes to ensure financial statement accuracy, a process that continues in subsequent years to verify the ongoing effectiveness of implemented controls.
Internal Controls, Financial Statement Audits, Process Improvement, Risk Management, Teamwork
Advizer Information
Name
Job Title
Company
Undergrad
Grad Programs
Majors
Industries
Job Functions
Traits
Macartan McElroy
Internal Audit
Compass Diversified
Villanove University
N/A
Accounting
Finance (Banking, Fintech, Investing)
Finance
Video Highlights
1. Macartan's role involves a team-based approach to internal audits of various entities within a publicly held investment company.
2. A significant part of his responsibilities includes an initial walkthrough of newly acquired companies, encompassing meetings with management across different departments (accounting, operations, HR, legal) to understand their business processes and internal controls.
3. He also focuses on evaluating system access within these companies to identify and mitigate potential risks associated with excessive access privileges that could lead to fraudulent activities.
Transcript
What are your main responsibilities within your current role?
As I'd mentioned previously, we take a team approach when performing an internal audit of one of our entities. At the company I'm at, we're a publicly held investment company that acquires other companies with the idea of growing them. We want them to expand and become great in their industry, to truly be something special.
When we acquire a new entity, my responsibility is to perform an initial walkthrough. We meet with management not just from the accounting department, but also from operations, human resources, legal, and other areas. We discuss how they run their business and their established processes.
We then look for internal controls within those processes that we can rely on to ensure their financial statements are properly set. To me, it's a lot of fun learning about companies and talking to the people who, at times, created them. I enjoy understanding their vision, their goals, how they executed them, and how they maintain those processes daily. This includes understanding the people they hire and the skill sets they look for.
Initially, when we buy an entity, we also examine their systems. We see what kind of systems they have, and from an internal audit perspective, it's critical to find out who has what access. If someone has too much access, it could be a real issue, potentially allowing them to do things they shouldn't. We take a critical look at their system access to ensure it's proper.
After gaining an initial understanding of the business, systems, and who has access, we perform detailed testing. This involves testing five defined processes to determine if the information from each process is leading to the financial statements appropriately. We check for proper review and ensure there are checks and balances throughout the processes and systems. That's primarily my responsibility.
Sometimes, when new entities set everything up, flush out their processes, and identify key controls, we then ensure in the second and third years that we're executing tests of those internal controls.
Advizer Personal Links
linkedin.com/in/mac-mcelroy