Guide to changing your auditor

From reassessing your audit firm to successfully switching, here’s what you need to know

We have prepared insights to help you understand the important considerations involved in changing your auditor. While there is a science to the process, there is also the “softer skills” elements–the reality of chemistry with your auditor and, further, you audit team, that makes all the difference. As the saying goes, “Knowledge is power”–so, please, explore all the articles and the “bite-sized” podcasts to arm you with the appropriate understanding for such an important undertaking.

As your business grows, your needs often become more complex and specialized. Whether you need deeper industry knowledge, a wider geographic footprint, better communication or greater digital velocity, your business goals come within reach when your audit firm is capable of servicing your evolving organization.

The right audit firm understands your business and delivers human insights powered by technology. But how do you find that firm? And once you do, how do you forge a productive working relationship? The following resources are designed to guide you through changing your audit firm, enabling you and your organization to thrive.

550

New audit engagements by SEC registrants in 2021

49.2%

SEC registrants that have engaged an audit firm for fewer than 10 years

Understanding what your organization needs from its audit firm

They say, ”The most important thing a fish can understand is the water in which it swims”–so it is with selecting your new/next audit firm. The better–and more honest–you can be about your company’s needs and aspirations, the better equipped you are to assess a new auditor’s ability to help you achieve your goals–and provide a quality audit experience. After you have this aspect in hand, please investigate the other informative pieces that can help you with your selection process, assess a firm’s dedication to innovation, as well as the current considerations of changing your auditor.

Sometimes it is readily apparent that you have outgrown your auditor’s capabilities, and sometimes there are a few more subtle signs that it’s time to reevaluate the relationship.

An auditor with more resources, deeper technical knowledge, greater capacity and wider geographic reach may better serve the volume, timing and complexity of your needs. You may also benefit from stronger communication with your auditor and more attention paid to your organization’s unique circumstances.

You do not want to switch auditors solely because of fees. Firms that invest in technology and the right technical skills to service clients come with commensurate costs. To that point, though, you want to be sure your auditor is providing value.

Ultimately, your business needs will highlight when it’s time to change your audit firm and direct you toward an auditor that can service those needs as you grow.

An auditor with more resources, deeper technical knowledge, greater capacity and wider geographic reach may better serve the volume, timing and complexity of your needs.

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How to choose the right audit firm for your organization

The right place to start with evaluating your new audit firm is with evaluation your own organization and understanding your current needs and projecting what your company will need in its next phases of growth. After you have gleaned the key points from this article, please review the other sections–and the compact podcast series on the importance of innovation in the modern audit-that will walk you through gauging if it truly is time for a change–and, if it is, how to measure and balance your needs with the capabilities of your next firm. Ultimately, exactly how do you transition as gracefully–and successfully–as possible?

Finding the right audit firm for your organization can be a daunting challenge. You are looking for a firm that not only will deliver timely and effective audit services in accordance with independence requirements, but one that also will be a trusted source of relevant financial reporting insights throughout the different phases of your business’ growth.

While many firms can tackle the technical aspects of an audit, those that go beyond will help you anticipate what lies around the corner, identify opportunities and mitigate risks. Such a firm attaches great importance to understanding your business.

Your organization may need from its audit firm deeper industry knowledge, stronger communication, more attention, access to audit partners or a smoother digital audit experience. Whatever the case, it’s crucial that you understand how an audit firm delivers value and would be capable of servicing your growing company.

Auditors who are steeped in a particular industry can help you navigate the intricacies of industry-specific accounting issues, the latest developments and best practices.

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The right innovation: Human insights powered by technology

The right next auditor for you has not just embraced, they have ingested/injected innovation into their DNA, their digital audit ecosystem is now the entry point–literally and figuratively–to a modern audit experience. After a firm’s digital extensibility–and accessibility to “best of breed” innovation, it will be necessary to assess your own company’s readiness to make a change. What’s important to you? What are your goals and, even more importantly, what are your organization’s aspirations? How do you get the best fit? And–ultimately, what are the best steps to a successful transition?

As businesses increasingly deploy advanced technology to make their processes less time-consuming and more efficient, they expect an auditor that is doing the same by also investing in its own technology to optimize the audit process.

But technology on its own only goes so far. Leaning too heavily on technology may not provide the appropriate level of personal attention or the necessary technical insights.

RSM’s audit delivers human insights powered by technology. Our approach to innovation and technology focuses on three pillars, which we use to increase efficiency, minimize disruption and uncover new information. These pillars are: intelligent automation, data analytics and the digital audit experience.

By bringing together these capabilities, our tech-savvy auditors can deliver audit solutions that are tailored for your business needs, minimize disruption and reveal new insights.

As we automate routine tasks, we create time and space for higher-level thinking that drives insights; and with data analytics, we analyze at broader amounts of data and share those insights with clients.
Sara Lord, chief auditor of RSM US LLP

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Best practices for transitioning to a new audit firm

Just as we have curated a compilation of considerations for changing your auditor, you must curate your own reasons for embarking on changing you auditor. It is not a light undertaking; it takes validating if it truly is time to make a change. Take time to review the other resource materials to development an idea of how to assess your next audit firm–juxtaposed to with your company’s needs, whether they can provide a modern audit, and, how to make the change successfully.

Changing auditors can represent a business opportunity—as long as the transition is smooth. You can achieve the desired gains by cultivating trust and a mutual understanding between your organization’s stakeholders and the new audit firm, and by underscoring the importance of timely audit processes and related communications. After all, superior service has no size constraints, and a frictionless transition only amplifies the opportunities for your business.

A change of this magnitude is most effective when the audit firm has experience transitioning an organization from its previous auditor. Meanwhile, there are steps you can take to ease the switch. From strategically structuring your request for proposal to educating your new audit firm to cultivating chemistry with interpersonal interactions, you have control over whether changing your audit firm accomplishes your objectives and satisfies the needs you identified at the outset.

What's important is that you have the appropriate client collaboration and engagement to be able to work hand-in-hand with your partner to keep the project timelines. The RSM team really did step in and help streamline and make the process fairly smooth.
Vice president, global accounting at a public company

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