Today, the term “remote audit” denotes a certain way of performing an engagement within the overall category of financial audits. However, as time goes on, there will be less need for the “remote” qualifier as site visits become increasingly rare. Eventually, it will just be the “audit.” Jennifer Wilson, the head of Convergence Coaching, said this change was already starting before the pandemic, and has only accelerated since then.
Part of this is due to technological change. Wilson noted that all the technologies one uses for a remote audit have improved in both quality and price over the years, making such engagements much easier than before. Cameras are a great example, with Wilson noting that today people can easily get high-quality models for under a hundred dollars. When adding on other advances, like better Internet connections, it’s easy to see why the remote audit is on the rise.
“It’s phenomenal. … The camera quality is good, I’ve got inexpensive lighting, I’ve got wonderful 5G high speed, I can do decent quality live streaming, whereas five years ago I had to hire a company to do that. I see all that just continuing to evolve,” she said.
Adding onto this prediction is the fact that developers are starting to write their software with remote work in mind as well. She said they have observed how much more telecommuting people have been doing over the past few years and are working to fill a market segment that hadn’t been taken as seriously prior to the pandemic. Software companies embracing remote and hybrid work, she said, will only push the profession further away from the days of site visits because the programs will be working from the assumption that the professional is not physically there.
Another driver will be client expectations. Clients in the past may have been used to site visits, but that didn’t really mean they liked them. As technology improves, more potential clients are questioning why someone would need to be there at all, moving the market more towards professionals with remote work capacities. While she was speaking in the context specifically of audits, she said that the same dynamic is in play throughout the profession.
She recalled a conversation she had with a CFO two decades ago, who was frustrated by his client accounting services provider, to illustrate how long clients have wished to shed the site visit: “[He said] ‘Our CPA insists on meeting in person to review the financial statements he produces for us, but I don’t need to meet in person, I can read those reports myself and I can have a phone call or send an email if I have a question. He’s not my father, he won’t dictate how I choose to review my financial statements.’ That has stuck with me, that guy’s plea,” she said.
She said it shouldn’t just be clients demanding a shift to remote audits, though. She said firms should understand that the site visit is an extremely inefficient operation, one that should be abandoned as soon as practicable.
“If one of your top quests is efficiency, and it should be, then sending people to an audit — staff and seniors predominantly — and have them sit at a client for a week, it’s not the most efficient way of auditing. … You’re carting all sorts of screens and equipment, some of the conditions are poor in these locations, clients are not thrilled to give up the space to you, we’re not doing a lot of facetime: There’s hundreds of reasons why that paradigm doesn’t work,” she said.
She said she has been shouting this message from the rooftops for years, and has been gratified at how it seems the profession is finally ready to hear her. She believes this will be good for accounting firms, as investing heavily in remote work capacities also means widening their pool for both potential clients and new talent because they are no longer as bound to geography. She noted one client she worked with to build out his remote work abilities because he was in Los Angeles where the traffic meant going from one place to another was a difficult proposition. They shifted to remote auditing which opened up a whole new possibility for employment, too. Now, she says, he has employees in 17 different states.
“They don’t care where you live,” she said.
She acknowledged that there are many in the profession who have adapted to remote work only grudgingly and saw it as a largely temporary thing to survive until everyone could come back to the office. She said she is concerned some of these leaders may try to turn back the clock, which she said will lead them to hurting their own firms. While it may be tough to swallow, Wilson said firm leaders must acknowledge that there is no going back.
“Yes, there are partners in these firms who want to return to the way they used to be, but don’t we have that in all society? People who wish for the good old days that weren’t even that good? Time marches on. Change waits for no one. The reality is that the next-generation talent and client want efficient, progressive solutions, and remote auditing is a part of that,” she said.
That being said, Wilson doesn't believe the audit will never have any physical interaction at all.
"Remote auditing, remote client service, really, isn’t necessarily 100% remote – like we never have face time. It is moving to a higher percentage of remote service delivery and the relationship elements can be – and sometimes should be -- in person," she said.
This story is part of an Accounting Today series called “The Frontier,” where we explore the cutting edge of accounting technology through conversations with thought leaders across the country, who will share with us their observations, hopes, concerns and even a few predictions here and there. We’ll see you at the Frontier.
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