The product of an audit of accounts is a report structured and "standardized" by the technical regulations on auditing issued by the ICAC, in which the auditor expresses his opinion on the annual accounts of the company in a given financial year.
In practice, we find that, beyond the wording of the qualification or emphasis paragraphs, there are hardly any differences between the reports issued by a large audit firm, the so-called "Big Four" or a medium-sized firm, and between those issued by a small audit firm or an individual auditor.
Then the question arises: what is the difference between contracting the audit service with a large or medium-sized firm, or with a small firm or an individual auditor?
Before making a decision about contracting the services of an audit firm, the employer should know the strengths and weaknesses of the firms that operate in the sector to assess what is most suitable for his company at the moment in which it is applied. considers auditing it for the first time, or making a change of auditors.
In this article we are going to focus on the strengths and weaknesses of large and medium-sized audit firms, and that directly affect the company that wishes to hire their services.
In general terms, and in terms of their strengths, large and medium-sized firms have a brand. They sell their services based on their own reputation, without dependence on the partners who run the organization at all times. This lack of dependence on partners implies another strength: continuity. There is greater ease for the succession, since there will always be a second step of professionals who will access the status of partners.
A large or medium-sized firm, with a significant size, can always afford to have partners who deal with business management tasks in the firm, such as representing the firm, carrying out commercial actions, managing human resources, etc. ., which provides a differential value with respect to its competition. It is common for these partners to also form part of study groups of national and international accounting bodies, or to reinforce the firm's image with their presence at conferences, seminars, conferences, and in the faculty of postgraduate courses on accounting. accounting and auditing from different universities.
Their ability to access technical and material means is greater than that of small firms and small individual auditors, since they usually have a network of national and international offices, as well as more technology and access to knowledge management.
These firms offer their employees career prospects based on professional development and training, which will allow them to move up the firm over time. The pyramidal structure and the systematization of tasks allow them to have great profitability and efficiency in their work.
However, the potential client should know that large and medium-sized firms also have weaknesses.
The client perceives that, in their relations with the firm, their interlocutors tend to change over time, which gives rise to a "depersonalization" of the professional relationship, which is sometimes excessive. This leads to a lack of complicity and closeness with customers, and this fact tends to be extremely displeasing, especially to the owners of SMEs and large companies that, despite their size, continue to be familiar.
In addition, in any large organization, internal procedures are especially relevant, which entails a certain "bureaucratization" of the relationship with the client. This translates into a certain slowness in decision-making, which results in a lack of agility and flexibility to meet the demands and, sometimes, the expectations of customers.
On the other hand, in order to maintain the firm's technical level, reputation and quality, it is necessary to continually invest in marketing, new technologies, material resources, infrastructure, etc. It is for this reason, and for the prestige of the brand, that the professional fees that large and medium-sized audit firms usually quote for a specific audit job are usually higher than those quoted by small firms and individual auditors.
Finally, growth usually entails lack of control in the quality of the service provided. Clients who complain about the presence of interns with little experience in the work teams that manage their account can attest to this fact, and who perceive that the difference in quality of service compared to small audit firms is not related. with the existing difference in professional fees.
