The Presidential Transition Act of 1963

The only thing more expensive than education is ignorance

In what will be a series of posts that explore relevant aspects of the recent United States election to the world of independent assurance, Honestly Lay Bare today brings down from the shelf the Presidential Transition Act.

The Presidential Transition Act of 1963 (Public Law 88-277, 3 U.S. C. 102 note) was enacted to provide for the orderly transfer of executive power in connection with the expiration of the term of office of a President and the inauguration of a new President.

Since the time the Presidential Transition Act was passed, transitions have grown more complex and cumbersome, often leaving the new administration without the head start it needs to begin governing on inauguration day.

What in the world can The Presidential Transition Act of 1963 have to do with the best practice execution of corporate governance, risk management and internal audit.

Thanks for asking!

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The United States Government Accountability Office (the GAO) – the audit and investigative arm of the United States Congress – has recently released a website called www.gao.gov/transition_2009 which should serve as the model that all professionals interested in mitigating risk within their organisation (or indeed countries!) can turn to during times of either Board or Senior Management transition.

What the GAO has done is to revisit all of its recent work to identify where its work can help address urgent challenges facing the United States, to assist new appointees from President Obama down to focus on the challenges of governing and to help identify areas with potential to save billions of dollars.

Keep in mind that this is the first post September 11, 2001 transition of power and is in an environment where there are serious challenges relating to financial markets and the economy.

As the Acting Comptroller General Gene Dodaro said at the time of the release of the website: “The new website is designed to be easy to navigate and to find information since this is a period when appointees have limited time to learn about their new positions and the challenges that come with making a successful transition from campaigning to governing”.

The GAO is designated by the Act as a primary source of briefings to new appointees.

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Translate this now what role assurance professionals can and should play in ensuring smooth transitions of power.

Should corporates seek to develop their equivalent of the GAO site and would that be beneficial to the continuity of understanding of risk within the organisation.

Honestly Lay Bare can see the day when organisations serious about ensuring that risks are perpetually managed well develop and maintain a secure transition website that is used to inform, educate and caution incoming or newly appointed senior custodians of the past and current health of the organisation and what challenges may lie ahead.

Yes it will cost money but to use the words Margaret Thatcher … the only thing more expensive than education is ignorance.

Ignorance of risks should never be an option.