Asking the right questions when considering accepting new audit clients, or continuing a relationship with an existing client, is the key to establishing a quality relationship, according to a new paper issued by a group of audit firm networks.
The paper, "Client Acceptance and Continuance," summarizes the current practices in several of the large networks of international accounting firms and examines how asking the right questions can help ensure that only those entities that meet the same standards of quality as the audit firm be accepted or continued.
The document was issued by the Transnational Auditors Committee, the executive committee of the Forum of Firms, an association of networks of international accounting firms that perform transnational audits. The committee is also part of the International Federation of Accountants.
Any business wishing to establish quality relationships with quality clients needs robust processes in place, said Forum of Firms chair Robert Dohrer in a statement. Understanding the best practices in this area will hopefully contribute to all accounting firms being able to strengthen their approach and create more mutually beneficial auditor-client relationshipswhich ultimately will contribute to improved public confidence in the industry.
The paper focuses on how the large networks of international accounting firms have implemented the requirements of International Standard on Quality Control 1, Quality Control for Firms that Perform Audits and Reviews of Financial Statements, and Other Assurance, and Related Services Engagements in their client acceptance and continuance policies and procedures. The paper also discusses related tools and devices that firms have employed to strengthen their client acceptance and continuance decision-making processes.
Client Acceptance and Continuance can be downloaded free of charge from the Forum of Firms section of the IFAC Publications & Resources site at http://web.ifac.org/publications.
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