Herbert Pambayi | Head | Assurance | Chapu Chartered Accountants Inc | mail me |
COVID-19 came with its own challenges for businesses, requiring companies to pivot and adapt to new ways of working and changed the working environment completely.
Small auditing firms were not spared from this, they needed to quickly adapt and fully equip their employees with resources to ensure that they continue to operate and serve their client’s needs. This required businesses to invest in technology and ensure that they have the right security measures to safeguard their business information.
While this presented challenges, it was also an opportunity for auditing firms to relook at their business strategies and invest in the right solutions to ensure they remain competitive in a highly competitive environment.
Some of the challenges and measures that auditing firms should consider are:
-
Staff turnover
Retaining talent is one of the biggest challenges faced by small auditing firms. Employees tend to seek opportunities at competing firms for financial growth or big auditing firms where they believe the firms have the right resources to help fast track their career growth. Therefore, it is empirical for small auditing firms to develop strategies that will help mitigate this risk, one of the ways is to develop talent management strategies and investing in the right technology systems that can help fast track their staff career growth.
-
Technology
Taking an approach of putting technology as a core of your business strategy to improve operations will not only help you with business deliverables but will also put you at an advantage over competitors. Technology can also form a big part of talent strategy by training your staff to be equipped and familiar with the latest technology in the profession, this will help them develop new skills and improve operations and customer experience.
-
Cashflow management
Fixed costs such as rentals, salaries, municipality bills can pose a challenge for the firms if there are no good cashflow management strategies to ensure that operations run smoothly. It is advisable that firms have adequate savings to cover fixed costs for at least six months. This will help ensure that operations are not disrupted in instances where there are delayed payments from clients. Firms also need to factor in travel and accommodation costs as sometimes staff are required to travel to clients.
-
Quality management
Quality assurance is the core of the auditing profession as clients need assurance that the work produced by auditors will create value for their businesses. Therefore, small auditing firms need to invest in quality controls to ensure that they deliver work that will bring value to their clients. We have established a dedicated quality management unit that specifically deals with quality matters in all our engagements.
-
Compliance
The auditing profession is highly regulated and requires that firms comply with the regulations, standards and the code of conduct for firms and professionals. While this may sometimes be overlooked, it is advisable to ensure that your business is always compliant to avoid being sanctioned as this may result in financial losses.
-
Access to markets
A significant challenge is gaining access to the different market opportunities or new markets due to the perception that a small firm may not have the required skills and competencies to adequately service those markets. It is important to ensure that for all engagements you perform as a firm, one delivers exceptional quality service. This assists in enhancing the credibility of the firm.
To tackle some of these challenges, small auditing firms should consider collaborating with big firms to gain access to markets and technology platforms that can help them improve their efficiencies. Moreover, they can consider tapping into freelance or contract workers to gain access to specialised skills that they may not currently have or afford to take them on a fulltime basis. These experts can assist firms with ensuring that they are compliant with relevant laws and regulations.
