Increasing Audit Profits Series No. 3--Know Your Stuff! | AccountingWEB

Increasing Audit Profits Series No. 3--Know Your Stuff!

Years ago, I remember meeting auditors that reasoned this way:  “To complete an audit, all I have to do is support balance sheet classifications 100% at the beginning and the end of a year.  Everything else will drop out on the income statement.”  Some of these auditors are still around! This approach may have worked decades ago but not now!  

In a live seminar in a state that didn’t have mandatory peer review, I asked the participants what practice aids they used to ensure compliance with the quality control and auditing standards.  One small-firm CPA shared her firm hired someone from an international firm that brought copies of all that firm’s documentation, which was used in her firm…for the last eight years!  Guess what happened when peer review became mandatory in that state?

A partner in a medium-size CPA firm apparently didn’t like audits.  He delegated all engagements’ supervision and review functions to a qualified manager. The partner did, however, read the financial statements and sign the audit reports.  A few months back, this partner topped the list of disciplinary proceedings on the Professional Ethics Executive Committee page of the AICPA website!

Most of us recognize that knowing what we are doing is required by the AICPA’s Professional Code of Conduct.  We also recognize that quality engagements can only be achieved by complying with all current, applicable auditing and accounting standards.  Unfortunately, we have a few demands on our daily time that often puts learning time near the last item on our “to do” list!  That’s when we attempt to achieve quality by using all the forms, checklists and programs purchased from a major publisher…on every audit!  Quality?  Maybe.  Efficiency? Unlikely!

At a time in our profession when new standards are being issued faster than we can open our email, how can we achieve both quality and efficiency on audits?  To that question I answer: Build an Audit Dream Team!  Be the first in your community to do this and I’m certain offers for television series will flow in faster than the new professional standards!

To build an Audit Dream Team is simple.  All team members just have to know their stuff!  Thorough formal and on-the-job training for all team members, including engagement leaders, is the STUFF of which engagement quality and efficiency are made!  Acquiring knowledge and learning how to apply it to engagements must be a CPA firm’s first priority to build an Audit Dream Team.

A great opportunity is before us right now!  You may know the Auditing Standards Board is in the process of clarifying and redrafting ALL existing auditing standards.  Although they will not be effective until periods ending after December 15, 2012, they ALL will be effective at that time.  Approximately 20 of such new standards are already published in the Clarity Project section of the AICPA’s website and can be downloaded for training purposes.  The good news is that the changes are mostly insignificant.  The bad news is that there are over 30 new standards!  Waiting until near the end of 2012 to train staff personnel could turn a Dream Team into a Nightmare!  It will take most of us at least two years to learn the organization and content of all the new standards, so the time to start is right now!

The ASB has prepared a “map” of the Clarified SASs to the existing AU Sections of the AICPA Professional Standards.  I’ve expanded that “map” to link back to the SASs that are currently effective.  This “map” can be used as a guide to facilitate individual and group study in your firm to ensure your Dream Team knows their stuff before these standards become effective at the end of 2012.

You can download the AICPA’s Map from the Clarity Project section of their website or you can request my modified version on my website,, by sending an email under the “Contact Us” tab.  Write “Email Map” or “Please Help!” in the subject line.  You may also wish to sign up for our free email newsletter to receive my new blog later this year that will dissect each of the new audit standards.

This blog

by Larry Perry, CPA, CPA Firm Support Services, LLC - Larry has over 40 years experience as a CPA practitioner, author of accounting and auditing manuals, author and presenter of live staff training seminars and author of webcast and self-study CPE programs.  He is co-founder of CPA Firm Support Services, LLC (, an organization providing resources, training and consulting to smaller CPA firms.  Larry writes a weekly blog on focusing on small audits, reviews and compilations.  He is currently developing documentation manuals and handbooks for small audits, reviews and compilations and related electronic practice aids.

More from this blog

Bloggers crew

Steve Knowles has spent 25 years in business and practice in the UK, but he also worked in the states and the years haven't dulled his way of seeing an alternative view to everyone else, and every day is a new adventure.


Joel M. Ungar, CPA is a lifelong resident of the Detroit area and a graduate of The University of Michigan. He is a principal with Silberstein Ungar, PLLC, a Top 15 auditor of SEC public reporting companies.


Allan Boress, CPA, with over 25 years as a practitioner and consultant to the accounting profession. Mr. Boress is the author of 12 published books in 6 different languages, including a best-seller, The "I-Hate-Selling" Book.


Larry Perry, CPA, CPA Firm Support Services, LLC, is the author of accounting and auditing manuals, author and presenter of live staff training seminars, and author of webcast and self-study CPE programs. He blogs about small audits, reviews, and compilations.

Sandra Wiley, COO and Shareholder, is ranked by Accounting Today as one of the 100 Most Influential People in Accounting as a result of her prominent role as an industry expert on HR and training as well as influence as a management and planning consultant. She is also a founding member of The CPA Consultant's Alliance. Sandra is a certified Kolbe™ trainer who advises firms on building balanced teams, managing employee conflict and hiring staff.

Maria Calabrese, CIR, Human Resources manager for Fazio, Mannuzza, Roche, Tankel, LaPilusa, LLC in Cranford, New Jersey, Maria's topics revolve around the world of: Mentoring, Performance management, and The "Y Generation," a.k.a. "The whY generation".


William Brighenti is a CPA, Certified QuickBooks ProAdvisor, and Certified [Business] Valuation Analyst, operating an accounting, tax, and QuickBooks consulting firm in Hartford, Connecticut, Accountants CPA Hartford.


Ken Garen, CPA, is the co-founder and President of Universal Business Computing Company (, a software development firm of high-volume, high-productivity accounting and payroll technology.


Eva Rosenberg, MBA, EA, is the publisher of, and author of the weekly syndicated Ask TaxMama column. She provides answers to tax questions from taxpayers and tax professionals worldwide.


Amy Vetter, CPA, CITP is the CPA Programs Leader for Intacct Corporation responsible for leading the CPA/BPO Partners nationally.

Brian Strahle is the owner of LEVERAGE SALT, LLC where he provides state and local tax technical services to accounting firms, law firms and tax research organizations across the United States. He also writes a weekly column in Tax Analysts State tax Notes entitled, "The SALT Effect." For more info, visit his website:
Scott H. Cytron, ABC, is president of Cytron and Company, known for helping companies and organizations improve their bottom line through a hybrid of strategic public relations, communications, marketing programs and top-notch client service. An accredited consultant, Scott works with companies, organizations and individuals in professional services (accounting, finance, medical, legal, engineering), high-tech and B2B/B2C product/service sales.

Rita Keller is a nationally known CPA firm management consultant, speaker, author, mentor and blogger. She has over 30 years hands-on experience in CPA firm management, marketing, technology and administrative operations.

Stacy Kildal is the mom of two fantastic kids, an Advanced Certified QuickBooks ProAdvisor, Certified Enterprise Solutions ProAdvisor, Sleeter Group Certified Consultant, a nationally recognized member of the Intuit Trainer and Writer Network, and co-host of RadioFree QuickBooks.
Michael Alter's blog specializes in providing practical advice to those who seek greater profitability and practice management tactics that enhance deeper client relationships.

Sally Glick, CMO, Principal, Marketer of the Year in 2003 and AAM Hall of Famer in 2007, leads a lively discussion of the constantly expanding roles of marketing and the professional marketers that drive this initiative in accounting firms of all sizes.


The IMA Young Professionals Blog features the insights of IMA’s Young Professionals Committee. Committee members share advice and experiences on careers, continuing education, work/life balance, and other issues affecting young accounting and finance professionals.


FEI Financial Reporting Blog provides highlights from SEC, PCAOB, FASB, IASB, and other regulatory news, including reporting under Sarbanes-Oxley Sect 404. It is written by Edith Orenstein, Director of Technical Policy Analysis at FEI.


Sue Anderson has 30 years of experience in continuing education for accountants. Currently she is the program director for online CPE provider CPE Link.


Jim Fahey is COO of Apple Growth Partners, a regional CPA firm in Ohio. His focus is on the effective and efficient use of technology within the firm by all team members.

Caleb Newquist is the Editor-in-Chief of Sift Media US, overseeing content for both AccountingWEB and Going Concern.

Leita Hart-Fanta, CPA, CGFM, and CGAP is the author of "The Yellow Book Interpreted" and owner of a website devoted to training for governmental auditors.


AccountingWEB is more than just a U.S. team of journalists and financial and technology experts - we have an international side, too! Members of our British team who publish share their ideas, insights, and perspectives from across the pond.