Ernst & Young Promotes its Quality Control Safeguards

In a newly-released brochure entitled, Maintaining Your Trust, Ernst & Young (E&Y) publicly explains how it maintains its focus on high quality audits.

Reasons Why E&Y Deserves Continued Confidence

The brochure describes the firm’s efforts and achievements in the following areas:

  • Tone from the top and culture that strongly supports collaboration and consultation
  • Higher-than-required standards for independence, (the "strictest in the profession")
  • Risk-based audit methodology, technology and knowledge enablers
  • Firmwide audit effectiveness training
  • Independent national professional practice function
  • Review of partner assignments
  • Concurring reviews and required consultations
  • Audit team disagreement resolution process
  • Partner rotation and performance-based partner evaluation and compensation methods
  • Audit quality review programs
  • Client acceptance and continuance criteria
  • Communication technology and knowledge databases

While some of these features are not unique to E&Y, the firm is believed to be the first to have come forward with such a convincing presentation of its strengths. Audits have always been notoriously difficult to explain, but this brochure may convince even the most skeptical clients that an audit is not a commodity after all.

A Way To Avoid Chairman Turley’s Worst Nightmare

With any luck, E&Y’s brochure will also help drive out the demons in its CEO’s worst nightmare.

"A client recently asked me what I thought to be the worst possible outcome of the current situation," says E&Y Chairman and CEO Jim Turley. "I told him it would be the implosion of Arthur Andersen… coupled with legislation by Congress that unduly restricted the profession… Add to this the imposition of too many requirements on audit committees," says Mr. Turley, "and we could end up with nobody wanting to do audits and nobody wanting to serve on audit committees."

Mr. Turley says he is optimistic that legislators and accounting firms will take the right steps to ensure a stronger profession, better financial reporting and stronger capital markets. He made the same remarks in an article in the Wall Street Journal, but those remarks were sandwiched between some rather distracting headlines. The same statement seems infinitely more credible and persuasive when placed in the front of a brochure packed with a long list of reasons to have confidence in his leadership and the future of the profession.

-Rosemary Schlank

You may like these other stories...

Here's a CPA who truly walks the walk. On March 15, Frank Ryan, CPA, departed San Diego, California, with plans to be in Ocean City, Maryland, by July 2 to teach a course at the Maryland Association of CPAs’ (MACPA...
When Theodore J. Flynn first joined the Massachusetts Society of CPAs (MSCPA) in 1970, it was a different world and a different profession.  The "Big Eight" were still headquartered in Boston. Vietnam War...
Accountant Rickey Charles Goodrich had it a little too good. Many bean counters would kill to serve as financial guru to the likes of Pearl Jam. Goodrich was hired in 2005, and the following year, he became the CFO of Curtis...

Already a member? log in here.

Upcoming CPE Webinars

Aug 21
Meet budgets and client expectations using project management skills geared toward the unique challenges faced by CPAs. Kristen Rampe will share how knowing the keys to structuring and executing a successful project can make the difference between success and repeated failures.
Aug 26
This webcast will include discussions of recently issued, commonly-applicable Accounting Standards Updates for non-public, non-governmental entities.
Aug 28
Excel spreadsheets are often akin to the American Wild West, where users can input anything they want into any worksheet cell. Excel's Data Validation feature allows you to restrict user inputs to selected choices, but there are many nuances to the feature that often trip users up.
Sep 9
In this session we'll discuss the types of technologies and their uses in a small accounting firm office.