Auditing a Strong Revenue Source for Firms
Auditing has gotten a bad "rep" over the past few years--and especially during the past year--thanks to investigative work done by the Securities and Exchange Commission and the fact that CPAs and accounting professionals have reportedly been seeking more lucrative, less risky alternatives to audit work.
However, some experts in the nation's top firms have gone public with their opinions that their assurance services are indeed a money-maker for their firm and that any integrity lost as a result of alledgedly poor auditing practices is not really their fault.
In the world of the Chief Financial Officer, however, opinions vary widely. A few former accounting firm employees who made a successful switch to industry, liken the audit business to "commodities" in which companies are extremely price conscious when it comes to engaging a firm to perform an audit. As a result, accounting firms may find themselves bidding lower on an audit in order to secure business from the company in other ways, such as consulting.
One CFO even compared this bidding practice to a K-Mart "Blue Light Special."