I hear the lament of auditors everywhere I go. The enormity of the accounting and auditing standards overload is decreasing audit profitability, particularly on smaller audits. Many smaller CPA firms have terminated their audit practices and others are considering doing so. That’s the bad news. The good news is that we can still make sizable profits on audits, even smaller ones!
During the weeks ahead (at least 30), this blog will focus on a long list of “profit makers” that, frankly, can improve the profitability of every audit engagement, even some reviews and compilations. This series will not be for the faint of heart! Substantially improving audit profitability means substantially changing some of the ways we do things. Increasing profits will require giving up some of our “tried and true” policies and procedures. Traditional preferences may have to be eliminated and detection risk may have to increase! It means investing time and money in the short-term to obtain long-term benefits. It means more work and less fun now so we can work less and have more fun in the future!
The benefits of change can only be maximized holistically. To say it another way, it won’t be worth our while to dabble with a few of the ways to increase audit profits. If we are serious about increasing audit profitability, we must be serious about incorporating all the “profit makers” in our audit practices. The synergy of all the opportunities working together produces the profit increases. We must be able, ready and willing to take a “giant step” toward change!
If you haven’t stopped reading, you’ve probably got what it takes for this journey. The full benefits of this series won’t be obtained by just being a spectator. I’m looking for participants! I’m looking for your ideas, your objections, your questions and your comments as we travel together. I’m looking for your commitment to this adventure!
Here’s how it goes: I present the profit-making ideas and how to incorporate them in an audit practice, count the short-term costs and indentify the benefit possibilities. You post your comments on the blog, I respond and we develop a profession-wide forum for making more money on audits! Mark your calendar and join me each week for your share of the pie!