Managing Global Audit Engagements Essay

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Managing Global Audit Engagements

The business world today is globally focused on new markets, labor sources and capital. The auditors of fortune 500 companies must consider the performance of international divisions and subsidiaries. This international component leads to challenges in planning and executing the audit engagement including language barriers, timing and scheduling conflicts, foreign regulation compliance, as well as conflicting business customs and social practices. As our global business environment increases in complexity, engagements are become more dynamic. Systems and processes now require cross boarder functionality to unite diverse teams toward the common goal of an efficient and high quality audit. Global companies expect their auditors to bring them quality service around the globe. Auditors need to be able to keep up with constantly changing standards, regulation, and industries. This requires audit firms to form large multi-disciplinary networks to facilitate high quality audits that investors demand. The big four accounting firms are best positioned to serve these clients. A review of the big four websites can illustrate the depth and breadth of their global networks. After browsing the firms’ description of their audit processes and analyzing a sample from different countries, it is clear that different locations have different approaches to serving clients. Through subtle description clues and variances in webpage structure, informative conclusions can be made about how each of the firms operate globally. After visiting PWC’s U.S. audit and assurance website, their slogan stated “A commitment to performing high quality audits, today and in the future, is a commitment we fully embrace. Our focus is on audit quality” (PWC 2013, 1). In their assurance mission statement, they mentioned “quality” twice. This shows that the firm values and protects the strength of their reputation. They use descriptive words like “embrace” and “commitment” to show their U.S. offices put a great deal of emphasis on building and maintaining relationships. However, their international branches do not market or describe audits the same way. The Canadian website’s headline is, “Audits you can trust” in bold font. They want to highlight that for an audit to be effective, the company needs to trust the auditors to keep their information confidential as well as keep up a constant stream of communication. Once auditors become untrustworthy, communication breaks down between the client and audit quality suffers. The PWC Chinese website talks about “improving corporate governance, strengthening internal controls, and adapting to new regulations.” PWC is aware that the Chinese have many growing businesses and improvements need to be made to strengthen reporting confidence with investors. Therefore, PWC can help with this transition process. As a whole, PWC seemed focused on building relationships to retain clients and to foster repeat business as well as bring in new business. By building strong relationships, they will be well positioned through economic swings and industry turmoil. Ernst & Young and Deloitte took a company-wide global approach to their audit description and marketing by making every country description the same. Ernst & Young’s slogan stated, “Clarity and transparency breed confidence” (EY 2013, 1). They were the only firm that used very expressive words like broadening, courage, integrity, and robust to describe their service. This hints they have a dynamic company culture and paints a picture of the people they desire to recruit. Deloitte’s website was also the same in each location. However, they took a boiler plate approach to their description by only giving a definition of what an audit is and how they perform the service (Deloitte 2013, 1). This shows they are very concerned with liability issues surrounding audits and take a very conservative approach to them. Deloitte appears to
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