While wearing a lot of oversight hats, the audit committee often interfaces with different members of the management team. It may be challenging for those members of management to present to the board, especially since some of these individuals may only have a handful of opportunities to do so each year. And there is a lot of room for improvement in those presentations, according to directors.Out of eight management roles, directors rank the presentation skills of only two as excellent, the chief financial officer and general counsel. It’s critical that executives hone their presentation style, polish their overall executive presence, and provide helpful and manageable pre-read materials. Doing so will impact the audit committee’s effectiveness and the audit committee’s impression of both the presenters and the functions they lead.

Click to enlarge in a new window.

We synthesized feedback from directors about how senior management can better engage with the audit committee. Here are five tips they gave for those members of management to succeed.

  1. Invest in your relationships. Schedule a meeting with the audit committee chair to get his or her impression of your role, its value to the company, and your presentation skills. As you further develop your relationship, you should continue to ask for feedback and coaching on how to improve. By forming relationships, you become a valuable asset—one that the audit committee can look to for expertise and help in what are often complex areas that may present unpopular messages. Also be sure to talk to other members of the executive team. They can provide insight into director personalities and dynamics. They might also be in the room when presenting and could have some good tips. 
  2. Know your audience. Audit committees (and boards) are different than other audiences. It’s important to balance the right level of detail, insight, and impact without being too granular. Be sure to effectively convey risks and concerns in terms directors can relate to. Audit committees generally have some sort of financial reporting background, so they’re comfortable with related topics. If, however, you are presenting on something more technical (like cybersecurity or emerging technology risks), it’s important to find the balance of educating the audit committee and achieving the objectives you have for your presentation. In general, the audit committee is looking for insights. That might be trends or themes, or concerns or challenges.
  3. Be thoughtful when preparing pre-read materials. Make sure any materials sent ahead of the meeting are easily digestible, especially if there are important messages to relay or critical decisions that will need to be made. If pre-read materials are not clear or are cumbersome to get through, the committee could misinterpret the message or focus on the wrong areas. If a presentation requires a regular cadence, it is important to develop a dashboard or some consistent reporting mechanism that will make it easy for audit committee members to monitor the activity. It is also important to work closely with the chair to develop reporting formats that are fit for their purpose. If you are presenting a new topic, like a tax matter or an investigation update, you will want to think about how audit committee members might read that data when you’re not there to walk them through it. It’s important not to send information that could be interpreted incorrectly. You want to provide enough detail to give them the background but save some insights for the in-person discussion. 
  4. Be strategic with your time. It should be clear that once the management team is in the room, the audit committee is ready to hand the reigns over to that team to lead the discussion. Pre-read materials should have had an executive summary that highlights what will be discussed—and the pre-read should not be repeated. Instead, the key risks and critical matters that require discussion and decisions at the meeting should be highlighted. The main objectives should be communicated up front, and you summarize and reinforce key points throughout. Be prepared for any questions (and reactions), as well as for any changes in the meeting direction.
  5. Focus on your message. You should scrap the jargon, know your material, and be engaged with your audience. Presenting is important, but make sure you are also asking the committee for questions and commentary. The focus here should be that the committee hears and understands management’s messages.

If the person presenting is a senior management executive like the chief information officer, chief audit executive, or head of tax, he or she may only end up presenting to the audit committee once or maybe a few times a year. When that person does present,  they’ll want to make sure those interactions are helpful and effective. Suggesting these tips to your senior management team will help your audit committee get the information it needs. These tips will also help give the management pipeline a chance to share ideas and interact with people who are deeply invested in ensuring that the entire company succeed.

For more on how to management should interact with the board, read our Executive Coaching series.