{"id":122339,"date":"2024-03-04t11:58:21","date_gmt":"2024-03-04t16:58:21","guid":{"rendered":"\/\/www.g005e.com\/?p=122339"},"modified":"2024-08-29t23:53:45","modified_gmt":"2024-08-30t03:53:45","slug":"premium-billing-cant-exist-with-traditional-audits","status":"publish","type":"post","link":"\/\/www.g005e.com\/2024\/03\/04\/premium-billing-cant-exist-with-traditional-audits\/","title":{"rendered":"traditional audits don\u2019t deserve premium billing"},"content":{"rendered":"

\"\"<\/p>\n

relevance empowers staff to do their best work because an audit isn\u2019t reduced to checklists.<\/strong><\/p>\n

by alan anderson, cpa
\ntransforming audit for the future<\/a><\/em><\/p>\n

if we can\u2019t demonstrate to our clients that our work is relevant, then the audit will go the way of the dinosaur. relevance underpins the other attributes.<\/p>\n

more: <\/b>four basic understandings every auditor must master<\/a> | put the ethics code to work for your clients and your firm<\/a> | turning audit & accounting into assurance & advisory<\/a> | wanted: great audit mentors<\/a> | is audit in crisis because of definitions?<\/a> | stop sending the wrong message to audit teams<\/a> | closing the audit expectations gap<\/a>
\n\"goprocpa.com\"exclusively for pro members. <\/span>log in here<\/a> or 2022世界杯足球排名 today<\/a>.<\/span><\/p><\/blockquote>\n

relevance is not a one-time event. it\u2019s a continuous process woven through everything your firm does. you build it one step at a time. this should be done with every audit, so this becomes core to the fabric of the firm\u2019s culture.
\n
\nwithout understanding what\u2019s relevant to the client, we can\u2019t practice business-mindedness and help improve our client\u2019s business. with an understanding of the relevance and how the standards impact the client\u2019s business and industry, the quality of audits goes up. relevance helps you evaluate innovative audit methodologies because you understand how they can be used to obtain the audit evidence you require. finally, relevance empowers your staff to do their best work because audit isn\u2019t reduced to filling out endless checklists.<\/p>\n

but what does relevance mean? in our accounting classes, we learned that relevance refers to timely, useful information with predictive value and that will make a difference to a decision-maker. let\u2019s think about how that definition applies to audits today.<\/p>\n

clients, stakeholders, regulators and auditors all have different perceptions of the audit’s goal. companies get audits because they are required to. the users of those audited financial statements \u2013 the ones who force companies to get audits \u2013 say the audit doesn\u2019t provide helpful information. regulators often find audited financials so deficient that they perform their own audits and examinations. auditors themselves can\u2019t effectively explain what an audit is all about.<\/p>\n

to be relevant, audit needs to zero in on the intersection of what you think is important and what your clients are interested in, and what is useful information to stakeholders. no surprise, but your clients don\u2019t care about the same things you do, nor do the stakeholders or the regulators.<\/p>\n

what do most auditors think is important in an audit? frankly, most auditors care about getting the work done timely so they can move on to the next engagement. the staff wants to get the work through partner review. the partners want to get through peer review. hopefully, they also want to be sure that the correct opinion is issued and they want the numbers to be materially correct, and to be sure that they\u2019ve correctly identified the risks. sadly, only a few auditors get into audit because they\u2019re interested in how businesses operate. that was the reason i got into auditing.<\/p>\n

firms today focus on one thing and one thing only: time. what we reward is meeting deadlines and keeping within your time budget. what we penalize is taking the time to think about what we are doing and how to make it relevant to the client. focusing only on the time metric is clearly helping undermine the relevance of the audit process. your team is only focused on getting the work done because they have another one down the road.<\/p>\n

we penalize taking extra time to talk to people because it interferes with getting the perfect realization rate. how many firms send a regular report to their staff that compares their billable hours and productivity rate and compares that to their year-to-date budgeted amount? does that inspire your team members to take the extra time to really understand the client and their industry? i bet not.<\/p>\n

what\u00a0are\u00a0the clients\u00a0interested in? they don\u2019t really\u00a0want<\/strong> an audit. however, they do want to keep the external users who requested the audit happy. but that\u2019s not all that they want. according to a 2018 survey by deloitte, the top two things c-level executives want from an audit are identifying potential risks and improvements for how the company operates. it sounds like they want more than a signed audit report to hand off to their banker.<\/p>\n

what do the stakeholders want? they want assurance that this organization will remain a going concern and will be able to continue paying its bills on time. they want reliable numbers to plug into their own modeling system to determine whether this is a good investment or not.<\/p>\n

how about the regulators? they want assurance that the organization is in compliance with the relevant laws and regulations.<\/p>\n

what is the intersection? it\u2019s not materiality, the correct opinion or the accounting standards. and as an independent auditor, you shouldn\u2019t be worried about keeping the stakeholders happy. the intersection is that clients want your help in identifying risks and ideas for improving their business. that\u2019s where relevance comes in.<\/p>\n","protected":false},"excerpt":{"rendered":"

relevance empowers staff to do their best work because an audit isn\u2019t reduced to checklists.<\/strong>
\n\"\"<\/a>
\nby alan anderson, cpa
\ntransforming audit for the future<\/a><\/em><\/p>\n","protected":false},"author":5075,"featured_media":122340,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_relevanssi_hide_post":"","_relevanssi_hide_content":"","_relevanssi_pin_for_all":"","_relevanssi_pin_keywords":"","_relevanssi_unpin_keywords":"","_relevanssi_related_keywords":"","_relevanssi_related_include_ids":"","_relevanssi_related_exclude_ids":"","_relevanssi_related_no_append":"","_relevanssi_related_not_related":"","_relevanssi_related_posts":"","_relevanssi_noindex_reason":"","footnotes":""},"categories":[3925,3120,3002],"tags":[4026,2394,4027],"class_list":["post-122339","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-audit-assurance","category-pro-member-exclusive","category-special","tag-anderson","tag-audit","tag-relevance"],"acf":[],"yoast_head":"\ntraditional audits don\u2019t deserve premium billing - 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