Ruben Cardona is one of the best accountants I know. We have been partners at Withum since my old firm merged with Withum in 2005. He merged in his firm three years earlier. We have lunch often and see each other regularly in the office. We also talk about a lot of things, and the ideas flow like water over Niagara Falls.
One of the things we always talk about is how the staff could do a better job. One day Ruben came up with his A.U.D.I.T acronym for the five steps of the audit process. This is the first time I am writing about this, although I have been walking around with the sheet I wrote it on for quite some while.
A: Analyze – Analyze the system, transactions and client’s processes.
U: Understanding – Understand what the client does and how they generate sales, ship their product or provide their services, and make money.
D: Documentation – Record everything you work on and observe.
I: Investigate – The auditor must independently verify and investigate the information presented to them.
T: Testing – Test transactions and sample activities.
Ruben also has his 5 P’s. Proper Planning Prevents Poor Performance. Some refer to this as the 6 P’s, with another P word before Poor. I have been using this for years in auditing speeches I present to younger staff. Nothing beats a properly planned job.
A third thing Ruben always says is, “You cannot audit a client if you do not understand their business.”
Ruben also tells younger staff, “Put yourself in the owner’s shoes. What would you want your auditor to come back with? That is how you add value.”
One thing Ruben does best is add value to the client. His advice is worth taking.
Use these as you see fit — with Ruben’s blessing.
Edward Mendlowitz, CPA, is partner at WithumSmith+Brown, PC, CPAs. He is on the Accounting Today Top 100 Influential People List. He is the author of 24 books, including “How to Review Tax Returns,” co-written with Andrew D. Mendlowitz, and “Managing Your Tax Season, Third Edition.” Ed also writes a twice-a-week blog addressing issues that clients have at www.partners-network.com. Ed is an adjunct professor in the MBA program at Fairleigh Dickinson University teaching end user applications of financial statements.Art of Accounting is a continuing series where Ed shares autobiographical experiences with tips that he hopes can be adopted by his colleagues. Ed welcomes practice management questions and can be reached at (732) 964-9329 or email@example.com.