strategies to make small shops more effective · presenter perspectives david givans - deschutes...
TRANSCRIPT
OBJECTIVES:
A REAL WORLD DISCUSSION, FROM SEASONED
SMALL SHOP VETERANS, ADDRESSING COMMON
ISSUES FACING SMALL AUDIT ORGANIZATIONS.
HEAR VARIED APPROACHES AND IDEAS AS THE
PANEL ANSWERS QUESTIONS OF INTEREST.
Strategies to Make Small Shops More Effective
ALGA 2015 Conference
Presenter Perspectives
David Givans - Deschutes County, OR One person shop, established in 2002 County with 166,000 residents, $220 million budget Previously worked with large and small CPA firms, providing
full service business consulting.
Michael Eglinski - City of Lawrence, KS One person shop, established in 2008 College town with 90,000 residents, $175 million budget Experience with large internal audit organization (KCMO –
1992-2009)
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Presenter Perspectives3
Harriet Richardson - City of Palo Alto, CA 4.5 auditors, 1 admin assistant; established in 1983 College town, 66,000 residents; 123,400 daytime
population; $470 million budget Experience in large, medium, and small audit shops and the
federal, state, and local levels of government
Themes of Interest from Survey
Following standards, ensuring quality
Productivity
Performancemeasures
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Quality Assurance and Peer Review
Why should you care?
Audit authority
Independence
Professionalism
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Challenges of small audit shops
Implementing professional standards
Preparing for a peer review
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Survey Input in This Area
Challenges of Small Audit Shops7
Educating your officials
Right-sizing expectations – training, peer review, adequacy of budget
Obtain results with minimal staff and budget
Adherence to standards
Implementing Professional Standards8
Establish the audit organization
Select professional standards
Create policies and procedures manual
Monitor internal quality control system
Preparing for a Peer Review9
Discuss the benefits of a peer review with the governing body
Compare ALGA Peer Review Guide to policies and procedures manual
Contact Peer Review Coordinator
Attend peer review training
Participate in a peer review
Where the Peer Review Paid Off10
Improved governance documents
Authority
Independence
Educating the Board
Strengthened documentation and practices
Reinforced standards with stakeholders
Small audit shops are the medium audit shops of tomorrow. Fight those battles today.
Professional standards are relevant
Be peer reviewed
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Quick Recap
Strategies for Productivity
How productive was your shop last year?
1. Above average
2. About average
3. Below average
4. Don’t know
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Productivity
More audit products – outputs
More efficiency, effectiveness, equity, transparency, accountability - outcomes
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How to Be More Productive
Work harder and with more skill
Find cheaper people to do the work
Invent or use a new technology
Figure out better things to work on
Source: Seth Godin The Productivity Pyramid
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Work Harder and With More Skill
Maintaining competence through a commitment to learning and development throughout an auditor’s professional life is an important element for auditors. Competence enables an auditor to make sound professional judgments.
Source: GAGAS 3.71
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Find Cheaper People to Do the Work
Is this an option in a small shop?
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Invent or Use a New Technology
Early 17th century: from Greek tekhnologia‘systematic treatment,’ from tekhnē ‘art, craft’ + -logia.
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Invent or Use a New Technology
Annual monitoring form
Engagement review form
Assessing data reliability
Automated work papers
Analytical software
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Invent or Use a New Technology
RALEIGH, N.C. — Martin Marietta Materials Inc. (MLM) on Tuesday reported fourth-quarter net income of $64 million.
On a per-share basis, the Raleigh, North Carolina-based company said it had profit of 95 cents. Earnings, adjusted for one-time gains and costs, came to 99 cents per share.
The results surpassed Wall Street expectations. The average estimate of analysts surveyed by Zacks Investment Research was for earnings of 85 cents per share.
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Figure Out Better Things to Work On
Fewer audit hours
More audithours
Less audit impact
Do some of these
Avoid these
More audit impact
Find these Do some of these
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Figure Out Better Things to Work On
Reflect on your own work
Talk with lots of people
Go to the ALGA conference
Pick up the phone
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Small Audit Shop Success Factors
Performance measures
Some reported out
Some benchmarked against other audit shops
Others only monitored internally
Generally common measures regardless of audit shop size
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Common Performance Measures
Reflect:
Productivity
Inputs
Outputs
Outcomes
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Topic Takeaway Links
Annual quality assurance reporting memo (DG)
Minimized audit procedures memo (DG)
Cost of toy (ME)
Data quality toy (ME)
Testimonial evidence toy (ME)
Checklist for initial review of performance measures (ME)
SharePoint workpaper management system (HR)
Pre-audit Information Request (HR)
Project-based risk assessment (HR)
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Topic Takeaway Links - Continued26
Staff Assignment & Independence (HR)
Audit Plan (HR)
Data reliability assessment (HR)
Nonaudit services assessment (HR)
Preliminary findings and recommendations, including overall assessment of audit evidence (HR)
ALGA quality assurance checklist (HR)
Auditee response (HR)
Questions27
We Are Glad to Help: Our Contact List
David Givans, Deschutes County, [email protected]
Michael Eglinski. City of Lawrence, [email protected]
Harriet Richardson, City of Palo Alto, [email protected]
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