What's in Your Purchased Practice Aids?

Have you noticed lately what is in your audit, review and compilation forms, checklists and programs? I looked closely at a set purchased from a major publisher this week and I know the answer.  They are like my elderly mother's purse.  They contain everything but the kitchen sink!

For a review engagement, I counted the number of pages of forms, check lists and work programs.  There were 20 pages of detailed questions and sign offs in the procedural documents alonge, and this didn't include the client acceptance and information forms!  I looked closely at the contents and my guess is that less than half are applicable to smaller clients!  My clients have always been small.  I learned how to read their trial balances, ask questions, propose adjustments and draft financial statements a long time ago.  Most participants in my staff training programs have too!  Why have we become a forms-dependent profession?  You may not like my answer.

Here it is.  The accounting and auditing standards have become so complex and change so often that many CPA firm leaders don't have the time to keep up with the changes.  When we can't stay abreast of the new stuff, our salvation becomes our practice aids.  Do everything in hopes we don't miss the big thing!  When leaders don't know what the standards require, they can't teach staff personnel.  Staff personnel become forms dependent.  I said you probably wouldn't like my answer!

Along came new audit standards a couple of years ago and another total revision is on the way from the Auditing Standards Board.  Now, new compilation and review requirements from SSARS No. 19!  More questions and forms.  Where will it end?

It will end when we end it!  None of the accounting and auditing standards, none of the quality control standards and none of the peer review standards say we have to use voluminous practice aids in a purchased system that don't fit our clients!  Our documentation must contain sufficient evidence for an experienced reviewer to determine if we've satisfied the applicable standards.  All I need is a copy of the professional standards or even a system of purchased practice aids just to use for reference.  The standards don't require us to complete forms and checklists that don't fit the needs of our engagements!

How do we break the forms habit?  It's simple but it requires a little time.  We learn what the standards require and teach it to other firm personnel.  Any of us can read SSARS 19 two or three times and become experts--it's really not that hard! We document some basic engagement performance policies and procedures in our qualtiy control document and share them with staff personnel over lunch.  We formalize some simple work programs for our small engagements and use them for guidance.  We eliminate about 25% of the wasted time on our small engagements!

For small compilation and review engagments, for example, I've eliminated about half of the pages in practice aids purchased from a major publisher and replaced them with simple documentation that will enable us to comply with professional standards and save a bunch of time.   If you'd like a copy of my Small Compilation Engagements Reference Tool as an example, contact me on my website (www.cpafirmsupport.com) and I'll email it to you.

My headline question was, "What's in Your Practice Aids?" The answer is, WAY TOO MUCH!

 

 

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 (www.cpafirmsupport.com), an organization providing resources, training and consulting to smaller CPA firms.  Larry writes a weekly blog on AccountingWEB.com 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.

42605

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.

74882

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.

47576

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.

87426
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.
20018

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".

54714

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.

79428

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

24582

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

63128

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

33974
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: www.leveragestateandlocaltax.com
101256
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.
25286

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.

51582
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.
27129
Michael Alter's blog specializes in providing practical advice to those who seek greater profitability and practice management tactics that enhance deeper client relationships.
31424

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.

98759

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.

32615

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.

109626

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

59896

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.

38635
Caleb Newquist is the Editor-in-Chief of Sift Media US, overseeing content for both AccountingWEB and Going Concern.
65621

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

91488

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 AccountingWEB.co.uk share their ideas, insights, and perspectives from across the pond.

52576