How to Add More Value to Your Audits

In today’s fast paced environment, it isn’t good enough anymore to ‘just be an accountant’. Customer intimacy, customer knowledge and the customer relationships you build overall are what will set your firm apart from its competition. How do you move from where you are to that model, though? This blog will help. It looks at ways that, if implemented, will add more value to your audits.

Provide advisory services

 As we know, audits are becoming more of a commodity and fee pressures continue to grow. So, how do you, as a CPA firm, stay relevant and differentiate yourself in the marketplace? Yes, you can:

  • Add more value to the compliance work and
  • Be more efficient

However, the REAL growth potential for a CPA firm and what clients are willing to pay for comes from advisory services. Keeping that in mind, who better than you should act as their trusted advisor? Fact is, you can do something that nobody else can do. YOU can provide that client with business intelligence.

As an auditor, you listen to your clients and you understand their businesses. This qualifies you to help them understand where the risks are, where the trends are, and how they’re doing compared to other businesses in the industry. That advisory skill helps the client better manage their business. Leveraging actionable insights is what provides more value to your clients and differentiates your firm.

Use of data analytics

One example of what you should be implementing is the use of data analytics. Data analytics help drive the quality of the audit, as well as advisory services. They provide critical pieces on information in a way that is easy for your client to understand, including:

  • Visualization of their financial status
  • Trends in their business

For real-time advisory services, though, it is important to have:

  • Access to the data and
  • Have ongoing conversations with your client

Those steps are what allows your client to make timely decisions throughout the year.

Moreover, data analytics is a tool that permits you to examine 100% of the data versus just a sample set. Also, it enables you to quickly find anomalies and outliers in the data and assess risk more accurately. Access to the data on an ongoing basis, and during the audit planning phase, is what helps you produce a higher quality plan. This has a direct influence on the nature, extension, and timing of your audit plan. Many times, with audit data analytics, you can set parameters around what is risky for:

  • This client and
  • Their industry

That aids your understanding of your client’s business, which ultimately helps you make better judgments throughout your entire job and helps you sequence work properly. With data analytics, your client will see the added value you delivered them throughout the year.

Take advantage of technology

Equally important, technology is the key to improving efficiency. When you take advantage of the technology available to you, then you will:

  • Take on more audits by improving realization
  • Have time to take on more advisory services

In fact, technology is the key to removing a lot of manual work, such as:

  • Collecting the data
  • Grouping similar accounts
  • Classifying the data for ratios
  • Following a dynamic audit methodology
  • Building financial statements

The take-away is this. Be sure you are using software that automates the time-consuming, manual tasks with artificial intelligence and machine learning techniques. Doing so frees you up to hone in on what’s important and allows you to use your professional judgement where needed.

Leverage CCH solutions

 At Wolters Kluwer, we have an Integrated Audit Approach. It consists of modules that support your end to end audit workflow, and starts with collecting data from your client:

  • Engagement Organizer – Our cloud-based request list directly integrates with CCH ProSystem fx Engagement. In addition, it will also integrate with our cloud-based trial balance soon! This organizer lets you request and receive documents from your client in one centralized location. You can request what documents you need, and by when. This is critical in driving the audit and its realization by making sure your client is ready for the audit. We all know busy season is crazy with juggling multiple jobs at once. Therefore, if your client is not ready, or doesn’t know what is expected of them, things can go downhill quickly.
  • CCH Audit Accelerator – This solution reads the accounting data directly from your client’s accounting system. That data is standardized and presented on screen. Then, within just a few clicks, you can look at a five-year trend analysis, drill down and see transactions, and even have the data formatted for Engagement.

TeamMate Analytics

Next, after you have the client data, use TeamMate Analytics to analyze that data and build visualizations in a dashboard. This application has a library of tests that includes full instructions to assist the auditor in knowing where and when to run the tests and how to interpret the results.  Even more exciting, everything is easily customizable. TeamMate Analytics is Excel based, which drastically decreases the learning curve. Now you can incorporate analytics into every audit and value-added service, providing improved quality and efficiencies.

Engagement & Knowledge Coach

Following, CCH ProSystem fx Engagement houses your workpapers and trial balance. Additionally, it includes an API for the trial balance. With that API, you can pull data and then use something like Power BI to create a dashboard of the information. Further, couple Engagement with CCH ProSystem fx Knowledge Coach to leverage the best methodology available – our risk-based audit methodology.

This risk-based audit methodology pushes firms to step back and obtain a solid understanding of their client before identifying risk. No longer are you following the ineffective ‘same as last year’ approach. Instead, the key with Knowledge Coach is it guides the audit team to identify and document key issues and items for discussion with management. Then, those key points flow into the one communication hub that prompts with reminders and further work needed.

CCH Axcess Financial Prep

Lastly, CCH is building a cloud-based engagement system. Its first module, CCH Axcess Financial Prep, is available today. The first module is a trial balance solution used for preparing balances for business tax returns. We are also aggressively adding more functionality to support compilation, review and audit engagements.

Conclusion

This blog is based on an April 2019 webinar hosted by Accounting Today, titled “From Audit to Advisory: Insights & Services for Auditors”. Presenters included:

  • Cathy Rowe, Director Product Management, Wolters Kluwer Accounting & Audit Solutions
  • Bill Novak, Director of IT, Meaden & Moore LLP

Click here to view this 1-hour complimentary webinar recording.

AUTHOR

Joel Ortner

All stories by: Joel Ortner