From Diagnostic to Remediation: Structuring Actionable PFM Roadmaps
Published on: Sat Oct 05 2024 by Ivar Strand
The standard engagement model for many third-party monitoring and audit assignments concludes with the delivery of a single, final artifact: the report. This document, often containing a dense list of complex findings and recommendations, is presented to the client as the definitive record of the review.
This is a flawed model. In our experience, a report that is delivered as a final, static product too often becomes a document that sits on a shelf. The findings, however accurate, fail to be translated into tangible improvements. At Abyrint, we believe our responsibility extends beyond simply identifying problems. The report is not the end of our work; it is the primary input for the most critical phase: the collaborative creation of an actionable roadmap for improvement with our client.
The Inertia of the Static Report
Static, stand-alone reports often fail to catalyze meaningful change for several predictable reasons:
- Lack of Prioritization: A long list of findings, from minor procedural deviations to significant control weaknesses, can be overwhelming for a management team to process. Without a clear framework for prioritization, teams often do not know where to begin.
- Abstract Recommendations: Recommendations are often framed in abstract terms, such as “strengthen internal controls” or “improve data quality.” While correct, such statements provide little practical guidance on how to achieve the desired outcome.
- Absence of Ownership: When a report is delivered as an external judgment, it can create a defensive posture and a lack of internal ownership for the proposed solutions. The process can feel imposed rather than collaborative.
A Collaborative Framework for Action
Our approach is designed to overcome this inertia. We view the draft report not as a final verdict, but as a diagnostic tool that serves as the starting point for a structured, collaborative workshop with the implementing partner’s key management and technical staff.
The sole objective of this workshop is to work with the partner to translate our findings into a formal, prioritized, and jointly-owned Corrective Action Plan (CAP). This is a methodical, facilitated process.
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Validate and Diagnose Root Causes. The session begins with a dialogue to ensure there is a shared understanding of the findings. We present the evidence from our data analysis and work with the team to move beyond the symptom to a shared diagnosis of the underlying root cause—be it a process flaw, a technology limitation, or a capacity gap.
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Collaboratively Prioritize Based on Risk. Not all findings carry equal weight. We use a simple risk matrix (assessing likelihood and impact) to facilitate a discussion with the management team to triage the findings. This ensures that collective effort is focused first on addressing the vulnerabilities that pose the most significant fiduciary, operational, or reputational risk.
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Define Concrete, Achievable Actions. For each high-priority finding, we work with the relevant team members to convert abstract recommendations into concrete, sequential, and achievable tasks. The recommendation “Improve payroll controls” becomes a set of specific actions, such as “Implement a variance check in the payroll system to flag any monthly salary change over 15% for mandatory review.”
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Assign Clear Ownership and Timelines. Every action item in the resulting CAP is assigned to a specific individual, by name and title, within the partner organization. A realistic but firm deadline for completion is mutually agreed upon. This simple step is critical for establishing clear, personal accountability for implementation.
The Goal: Knowledge Transfer and Sustainable Improvement
This collaborative process is, in itself, a form of capacity building. By involving the partner’s team directly in the analysis of the problem and the design of the solution, it fosters a deeper understanding of their own systems and strengthens their internal risk management capabilities. The goal is not just to fix the identified problems, but to transfer the knowledge required to prevent them from recurring.
A finding has no value until it is acted upon. Our responsibility as monitors is to ensure our insights are converted into improved functionality. The co-creation of a Corrective Action Plan is the mechanism by which we transform a monitoring exercise from a simple compliance check into a genuine catalyst for building more resilient and effective systems.
