Bosses at two of the UK’s biggest accounting firms have said that having auditors in the office more regularly would not necessarily improve audit quality.
The comments from senior executives at Deloitte and BDO come after KPMG told UK audit staff they would be expected back in offices and at client sites up to four days a week in the longer term.
Working in teams in the same location was “vital to ensure we collaborate more efficiently, deliver high-quality audits, and continue to develop our technical and personal skills”, Cath Burnet, KPMG’s UK head of audit, told her 6,000 staff in an email in November.
But rivals disagree that spending large amounts of time in the office is necessary to ensure good quality audits.
“I don’t see it as [being as] simple as ‘physical equals better’,” said Paul Eagland, managing partner at BDO, the UK’s fifth-largest accounting firm.
“Some things are still done better face to face, but that’s not a whole week of work, is it? That’s a well-timed progress meeting with the client,” he said.
Eagland’s views were echoed by Paul Stephenson, UK managing partner for audit and assurance at Deloitte, who said: “While there are elements of an audit that will happen in person, we don’t believe quality is impacted by auditors working flexibly and we have been operating in a remote environment very effectively for well over a year now.”
“The audit of each entity will be different. There is no ‘one-size-fits-all’ approach and that’s why we want individual teams, in discussion with the companies they are auditing, to work out the arrangements that will work best for each personal and professional circumstance,” he said.
Both Deloitte and BDO have allowed teams and individuals to decide how often to come to the office or attend client sites.
Offering more flexibility than rivals will help to attract staff, Eagland said. “Bright people can often work out what’s . . . right rather than us saying ‘it’s two days this or four days that’,” he said.
Auditors at PwC, the UK’s biggest accounting firm, will be expected to spend two to three days a week in offices or at client sites after the pandemic.
Hemione Hudson, PwC’s UK head of audit, said working in the same place as colleagues helped judgment, teamwork and learning but that much of the work could be done remotely while maintaining quality.
Auditors have relied on technology such as drones and CCTV to help with physical verifications such as stock counts while working remotely. But some senior auditors have worried that errors or wrongdoing may be harder to spot if they are not physically present.
Only 24 per cent of companies wanted their auditors to go back to working mainly on site, according to a survey by Source Global Research.
It found that 59 per cent of companies believed flexible working has improved audits and the vast majority said their auditor did a good job of adapting to remote working.
KPMG has not said when it will begin asking auditors to come to offices and client sites four days a week, but it is already instructing them to attend a minimum of two days. Some auditors have attended only occasionally so far this year.