use relationship building and a little bit of detective work.
by alan anderson, cpa
transforming audit for the future
ideally, if you’re practicing business-mindedness, you only keep the a and b clients. if a client is below that level, you must consider whether that client is salvageable. if the answer is no, you need to exit the relationship.
more: eleven types of audit clients and which to fire | don’t risk losing good employees for bad clients | four questions to make your firm more successful as a business | say adios to audit fee pressure | deliver more audit value by getting out of the conference room | six essential elements in audit planning | before the audit: more than just planning | five crucial attributes for successful audit leadership | put the ethics code to work for your clients and your firm | is audit in crisis because of definitions?
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for c and d clients, you want to try to grow them into a or b clients by developing a relationship with them. if they don’t reach that level within three years, they can be passed off to another firm. there’s always more than enough work to go around with a and b clients.
improving relationships with those c and d clients starts by developing a deep understanding of your client and the organization’s overall goals. use this as a framework for working with challenging clients. besides the overall company goals, it helps to understand how the cfo or controller you’re working with is being held accountable and measured in the organization. using that information, you can agree on how the audit will help them get what they need to deliver.
for example, if you have a penny-pincher client who has to cut expenses by 5 percent as one of the performance metrics they need to meet, you can agree that you’ll be on the lookout for areas in their company where they can cut expenses.
if you can come to a mutual understanding of what both of you will commit to during the audit and verbalize that, that can go a long way toward holding each other accountable. so, for example, with this penny-pincher client, you might agree that you will be looking for opportunities to save money and share those insights in the wrap-up. it would be helpful to get the information on time or even early to keep audit fees in check.
understanding how your clients are wired can also help make the working relationship smoother. for example, if you’re working with an analytical person, they will want to see all the details you have. but if you’re working with a strategic person, all that detail will just make their eyes glaze over.
one quick strategy for figuring out how best to work with clients is to ask them about any project they’ve done in their career that worked well. see if they’ll walk you through how the project worked. this may give you some clues about how to structure things so that things will work smoothly.