There may be errors in spelling, grammar, and accuracy in this machine-generated transcript.
Abdullah Mansour: Welcome back to smarter. I'm Abdulla mansoor here again with Sam Mansour CPA. Today we're diving into field work fumbles the execution phase of the audit where many engagements run into trouble. Sam, what causes the most issues during this phase?
Sam Mansour: Yeah, I mean, this is a great topic. Um, because once you kind of get past [00:00:30] the planning stage, which we talked about in prior episodes, you become efficient there. You get that done. Now you go out into field work and there are lots of things when you're kind of think of it like on the clock, right? The game is playing. The time is running. Um, if you are traveling to go out to the client, which a lot of auditors do, you might have a return flight at the end of that week, right? And then you might have another engagement going on the next week. So you [00:01:00] are constrained by time during that, uh, you know, field work week or days or weeks or whatever it might be for you. Sure. So it's it's super, super important to make sure that it's planned properly and it's set up properly. So engagements typically fall apart when there's no structure or leadership during field work. And so if you think about it, you have to manage what's happening during that field work process and you have to really keep an eye on it. There are some [00:01:30] people that go, you know, when it comes to maybe auditing certain work papers or sections, they're very efficient. There are other people that are definitely not as efficient, to put it put it politely. So if you don't have a lot of structure and leadership in that field work process, it's it can be it can get out of hand, it can get out of control. Um, and that can be a huge fumble because you can't [00:02:00] just tell people, hey, we're going to go out there for a week.
Sam Mansour: Do what you can do and let's leave. Um, the issue with that is we are up against a timeline. We do have a budget. We do have other considerations, you know, and maybe even we're taking up, um, specific time blocks from the client that they are, you know, they can't afford to give us more. So we have to be very careful. So the structure and leadership is huge. Teams often start without a clear plan, um, leaving responsibilities [00:02:30] vague and processes untracked. So if the communication from, let's say, the senior that's running that field work week, they're not a clear communicator. So the communication isn't clear to the team on who is doing what, how much time we have, what's ahead of us. It's vague. Okay. Sure. Um, responsibilities amongst the audit team is vague. People just show up. Essentially, the leadership is not very strong. [00:03:00] That is, you know, an area where we could get towards the end of field work and either either we're rushing significantly or we're not able to actually get it done in the time allotted. Um, and that's just, you know, a very uncomfortable feeling. So when something unexpected comes up, like a client delay or missing documentations, teams often aren't agile enough to adjust. So we almost like some, some, some auditors will plan for like a perfect field work week. [00:03:30] Let's say it's a week assuming that nothing really goes wrong. Well, that's a really bad assumption because generally I find that things do go wrong.
Abdullah Mansour: And so so you add in kind of a buffer there or is that exactly. Oh go ahead. Sorry.
Sam Mansour: No, no exactly. You want to you want to have a little bit of extra time for the unpredictable aspects of this. So yes, you are completely right. A buffer and that maybe let's say you're planning on leaving, uh, by end of day Friday. But what you should try [00:04:00] to do is maybe plan to have everything done by end of day Thursday. So you have a full day left, um, for maybe some cleanup, some additional questions, some some things that you don't expect, but trying to pack it all in to a very strict timeline and not planning for the unexpected is very dangerous. So structure in leadership, good communication, clearness as far as like responsibilities and delegation of duties [00:04:30] and then planning for the unexpected. Also, um, sometimes there's a lack of ownership. No one knows who owns which audit section. So then that makes things fall through the cracks again. It kind of comes back to that communication aspect where if you clearly delegate responsibility to people. So someone says, I'm taking ownership of half of the balance sheet, I'm doing the assets, and somebody else says, okay, I'm taking on the liabilities in the planning phase. If you do that properly, you communicate it, you assign out the work papers, [00:05:00] the team is clear on it, then things get done. If you go out into the field and you're like assigning things out and randomly, you know, um, handing things out to people during field work. What if you miss something?
Abdullah Mansour: Yeah. How would you know?
Sam Mansour: Yeah, exactly. Because you're just kind of doing it as you go. And that can be kind of a dangerous thing. And then, um, the client side delays are common. So especially when pbcs aren't readily. Sorry. Aren't already communicated to [00:05:30] the client or the communication is weak. So if we don't send out that list. So PBC provided by client, the client supposed to provide us with with documentation in return if we're not really providing strong instruction to the client. We kind of mentioned this in the prior episode where we weren't really crystal clear management of the client then. It's not. So it's not just a team, our team that we're managing in the field, but it's also the client and to some degree, their team, um, that we're trying to make sure that everyone's kind of playing well together and, and those are some [00:06:00] big areas that, you know, I've seen gone wrong a lot. And or let's say they don't go wrong, but they're just not efficiently managed. Um, it can be a really big problem.
Abdullah Mansour: Yeah. And your last point, I can see why you'd want strong leadership and everything in place if you have to manage your team, but then also your, uh, your client. So it's kind of two teams to manage in a sense is what it sounds like. So if you have a strong leadership team, it probably makes that substantially easier.
Sam Mansour: Yeah, a strong leader on the audit team like a strong senior sometimes. Sometimes people [00:06:30] will be picked to be the leader or senior auditor or in charge of the engagement. And they're not a strong leader, but they are put in that leadership position. They go out into the field and.
Abdullah Mansour: Oh, I see cause a lot of issues. Well, that sounds like a giant recipe for, uh, stress. So what's your recommendation for structuring field work effectively? Uh, from the start?
Sam Mansour: Yeah. I mean, this sounds very textbook, but planning, planning, planning, planning proper planning. [00:07:00] I mean, if you get all your ducks in a row, if you get everything figured out, it's like going out into battle, right? If you plan everything out properly ahead of time, when you go out, you have a higher chance, higher chance of being successful. If you don't properly plan things out before you go out there and you're just kind of planning as you go and you're kind of sloppy, that is a recipe for disaster and a lot of stress. So you really want to begin with the field work kickoff meeting, where ideally you're involving [00:07:30] your team and you're involving the client and you're and you're having a conversation to say, okay, you know, we've sent you these samples, you've returned X, we're still missing. These are these balance sheets sections prepared and ready for our audit. We're going to be coming out next week. You know. So everyone's kind of in the loop. And everyone's hearing what's going on in that that kickoff meeting I think that's really important that that's successful and everyone is involved as much as possible. And we're and we're reasonable. [00:08:00] You know, even if you have a a new person to your team or you have an intern or you have a brand new staff member, you want them to kind of have a sense of what's going on. You don't want them to go out there and say, what are we doing?
Abdullah Mansour: Is that kind of like a planning session for the field work, the kickoff meeting? Is that basically what it is?
Sam Mansour: Essentially, yeah. It's like a you know, let's say you have a course, you know, course level one, two, three, four, five. Think of this as like course level zero. It's right before we [00:08:30] get into the meat and potatoes of what we're doing. So it's the field work kickoff meeting. So we're we're saying hey guys we're at the end of our planning and we're at the beginning of our field work. It's kind of this like inner joint that we're kind of wrapping up the planning stage. We're going into field work and we're going to kick it off with this, with this, like it's kind of like, hey guys, here we are. We're ready to go kind of thing.
Abdullah Mansour: We have a plan. We have everything. So we're we're moving forward. The next step is okay. [00:09:00]
Sam Mansour: And we're kind of distinguishing the steps a little bit. Like I think sometimes an audit can kind of just roll into itself and kind of just get co-mingled as far as what we're doing. And sometimes planning is partially done during field work because we didn't get all the answers we needed. So kind of kind of can kind of blend in. So I kind of like calling it a field work kickoff meeting, because it kind of symbolizes and indicates to everyone, hey, we're going to the next step, right?
Abdullah Mansour: Can the planning, can a planning meeting also [00:09:30] be I'm guessing that's a, a huge, uh, factor in field work fumbles. You just don't have a plan. Yeah. If you just go to kickoff meeting, don't really have a plan, and you just go to field work, I'm assuming that can cause a lot of problems, potentially. Or is that less likely to happen?
Sam Mansour: I mean, I would definitely say That there's a lot of planning and a lot of coordination involved in these audits. And I've told people before when they've, you know, when [00:10:00] they get into the role of running jobs and being a senior on jobs, that senior manager that think of yourself like an air traffic controller. There's lots of pieces moving, right? Some planes are coming in, they're taking off. Some planes are on the ground. Some planes have maintenance issues. So when you're when you're in that role, in that mindset as an audit in charge, you're dealing with multiple clients. Some are ready, some have given you everything. You might be in the wrap up stage. You might be in the fieldwork stage. You might be in the planning [00:10:30] stage. So there's lots of different pieces moving on. You might be working with different teams in your audit firm, different people that are doing different things, working with the client. Maybe you're communicating with different people on their team. So there's a lot of moving pieces and one engagement and there's definitely a lot, a lot of pieces when you take multiple engagements that are kind of going off in or around the same time.
Abdullah Mansour: So yeah.
Sam Mansour: Really clean [00:11:00] and well structured planning, really clear meetings where everything is communicated properly, roles are assigned. The more crystal clear you are, I think it's really important. It's not just clear, the more crystal clear that you are, the more organized that you are. I don't think an auditor, in my opinion, can ever be too organized because it's only a benefit. The more things that you kind of have [00:11:30] out there that you're not sure about, they start to add up, right? Like, think about it in your life. Think about it in your personal life. If you have, let's say something that you know you're supposed to do for your wife and something that you're supposed to do for your kid and something that you're supposed to do for someone at work. And and you do a little bit of here, a little bit of there, but you owe everybody something and sometimes you're just like, oh shoot, what do I what am I supposed to do again for that person? Yeah, it it becomes [00:12:00] confusing and things get missed.
Abdullah Mansour: Oh of course yeah. Yeah.
Sam Mansour: Right. So so for me, I always like to make sure that we are crystal clear and you know, what we are doing and who we owe what to. So when it gets to the fieldwork part in that time crunch that we now have, because it's not unlimited time, we can't just sit at the client's office for months and months. We have a timeline. We have a window we're going in. In that window, we're doing our job and we're getting out. The more organized we are, the [00:12:30] better this goes. Um, so another thing, um, to kind of help, um, for structuring field work properly is using a shared, uh, audit tracker with clearly assigned ownership for every audit area, such as cash, receivables, payables and other tasks. And I mentioned this before, and I think I called it like the strategic PBC list. I made this multiple times. I've been a huge advocate of it. Um, that is kind of the audit tracker. There [00:13:00] are softwares out there and as you know, Abdullah, I like to use Excel. Um, and so I have used Excel for this. It's really crystal clear. We take, you know, the typical requests that we give to the client, we break it out into sections, we ask for one section at a time. And honestly what I like to do. So making this more applicable to what we're talking about here with field work.
Abdullah Mansour: Yeah.
Sam Mansour: Is we say let's say, uh, cash reconciliation. Cash reconciliation and bank accounts information. The client can go on there. [00:13:30] Let's say we have a CFO and they might say this specific person is going to provide it to you. So put their name there. Right. They can actually interact with this list, this this tracker and say this person's going to provide it. And then when that person provides it, they can go in there and put their little initials and date. Right. So upload it to the portal on this date. Here are my initials as in I did it. That shared audit tracker helps us know what they have given us. When did they. When did they give it to us? Um, so there's this [00:14:00] really clear. You know, they they clearly know when we want things and they clearly know when they've been provided. And so that audit tracker, especially if there's things that we needed during planning but we haven't yet received and we're in field work the, the the auditor in charge of the engagement during field work is crystal clear on what is missing. And so let me go to the client day one and say, look, based on our audit tracker, you gave us 80% of what we needed. This 20%. [00:14:30] We really need to get it this week. And it's a big priority. And then we're tracking it as it comes in, because sometimes the client will come in and hand something to someone on the audit team. Maybe the senior is out doing an inquiry and they come back and they didn't know that they got it right. So so tracking.
Abdullah Mansour: I see. Yeah.
Sam Mansour: As in okay. Received. Okay. Received is really important. So assign someone to update the tracker daily and flag any concerns bottlenecks. So I mean really we want to be looking at it regularly and even Abdul [00:15:00] and the stuff that we do together you know we use a task tracker. So essentially that's kind of where.
Abdullah Mansour: Oh of course. Yeah. And is that, is that, is that during the actual field work or just in general, they're looking at that tracker like beforehand afterwards. Where does that?
Sam Mansour: I like to use it throughout the whole process. I like to.
Abdullah Mansour: Use it the start from the end of the client.
Sam Mansour: Yeah, I think we mentioned this in prior episodes where we send the client an email saying, hey, you know, we're starting the audit, blah, blah, blah. You send them this tracker like months before the audit. So they [00:15:30] ideally we try to encourage them to use it. Right. Assign who's going to do your cash reconciliations, who's going to do your HR, who's going to get your capital assets. And then they should they should be in there using it because it's what we will then come in in our planning phase and our field work and our wrap up. And we're going to look at this and say, okay.
Abdullah Mansour: It's a way for them to prepare before you even get there. Is that kind of what the idea is behind it?
Sam Mansour: A way to prepare and to use what we are going to be using. And then when we're in the hot seat during field work and we have a window [00:16:00] of time that we need to get this done, we can clearly see now what we need. And during that week, we can really push hard during field work to make sure that we get it. Okay. And then I also build in checkpoints throughout the week the week of field work, mid week, end of week. Uh, a lot of people say, hey, I'm going to do an exit interview discussion with a client, which is very important. We want to schedule these checkpoints, um, to troubleshoot [00:16:30] and reprioritize, reorganize, recollect. So instead of just showing up into field work and saying, okay, you test, you know, these three sections, you test these three sections, you do these inquiries and and I'll see, you know, we'll talk to each other at the end of the week. Um that's kind of bad, because what happens if people encounter some, some, some hurdles during the audit and they don't say anything until like the day before we're supposed to leave? It's like, oh, shoot, [00:17:00] you should have told you should have told this to me. You know, you know, a long time ago. So the goal is to stay agile and organized, but not rigid, because if we come up with this extremely rigid schedule, the issue with that is that very rarely does everything go to quote unquote go to plan.
Abdullah Mansour: Um, it sounds like it. Yeah.
Sam Mansour: So we want to make sure that, um, we're flexible, but we're also very organized.
Abdullah Mansour: Yeah, [00:17:30] that sounds like a tough balance, but an important balance. And in all industries, but especially sounds like auditing where you have to have a plan and a tracker, but then also be very agile and organized. And so there's kind of a seems like there's a balance there.
Sam Mansour: Yeah. And to the point that we were talking about even this morning when I was talking to you, you can't have people say they're going to do things on the team and then not do them, because what happens then is we go back after the field work week to the office, and I'm like, [00:18:00] where is this thing that you said you were going to do? And then they they can't just say, I didn't do it because then we are, to be blunt, screwed, right? Because we have.
Abdullah Mansour: To go back.
Sam Mansour: To the client. And so I don't like and we've talked about this significantly over the last couple of weeks, just you and I. I don't like people being assigned things or committing to doing things and saying, yes, I'm going to do it by that time and by that date and then letting us down, because in a general scenario, we're fine. But in field work it's a big [00:18:30] deal, because if you don't do what you say you're going to do, if you don't take ownership of it and you don't get it done, it makes us look really bad to have to go back to.
Abdullah Mansour: Yeah, I'm sure even in general, it's it's extremely ineffective to just keep moving one due date out so I can imagine then a field work. How much? How amplified that is. So yeah.
Sam Mansour: What are you gonna do? You're gonna fly back out there. I mean, sometimes for the clients, their records aren't digital. So someone says, I'm gonna get this done by Thursday. As we've discussed before, they [00:19:00] don't. We say, hey, is everybody done? They say, yes. We get on a plane and fly back home on Friday, show up mid next week. We're reviewing the work papers and we're like, well, where is this? They don't have it. And um.
Abdullah Mansour: They're not digital. So they're like paper or what.
Sam Mansour: Yeah. Paper.
Abdullah Mansour: So then okay. Yeah.
Sam Mansour: So I mean it happens even in this day and age. So you, you talk to the, the, the person that was in charge of that section, you're like, well, where is this testing for this? And they're like, oh, I asked the client for it. I'm like, did they ever give it to you? Right. [00:19:30] And so we don't have that conversation and they just say, well, no, you know, um, I never got it. I'm like, oh crap. We contact the client, we're like, hey, where's the sample? They're like, oh yeah, we brought it in. But you guys were gone on Friday. And I'm like, okay, you know, well, can we get it? And then and then of course they get, you know, a lot of times the clients like huffing and puffing because they're like, I'll have to scan it in now and give it to you. And it's not just a stack of papers, it's things stapled [00:20:00] together and receipts. And I mean, they're not going to be happy.
Abdullah Mansour: And that's why I love the simplicity of the of the Excel task tracker. I know people have all kinds of software they use, but the Excel is just so simple that it's just almost impossible. Not it's very easy to follow. You just look at it. It's right there. Check it off. You're good to go. So that's a I can see how it would be very helpful in this scenario.
Sam Mansour: Exactly. We get wrapped up in fancy software and people get more concerned about clicking buttons and [00:20:30] you know, oh well, the software can't do this. You know, I'm like, I don't care, right?
Abdullah Mansour: Just doesn't matter. It's just a task.
Sam Mansour: Yeah, exactly. Just go do the job. And so again, when you're tight and you have this window for field work, you can't be screwing around, and you have to be efficient, and people have to be clear on what they're responsible for, and they have to get it done. And there isn't this kind of sort of dependable, dependable ness of them, right? They have to be extremely dependable and getting things done when they say they're going to get [00:21:00] done, because we cannot afford after field work. I mean, auditors do it a lot, but I hear from clients, they absolutely hate it when they say I provided that to your team when you are on site during field work. Why are you asking me for it now? Like.
Abdullah Mansour: Yeah, that's.
Sam Mansour: A gut wrenching.
Abdullah Mansour: Conversation.
Sam Mansour: It is horrible. We're charging them tens of thousands of dollars to do this, and we can't get our act together.
Abdullah Mansour: Yeah, well, we've kind of touched on the client side of things a little bit, [00:21:30] but I am curious to kind of dive a little bit more, a little bit into that, a little bit more. Um. What are your tips for keeping that process smooth? Kind of the client, the client side of things, I suppose. Yeah.
Sam Mansour: So basically like there should kind of be like a think of them like like a liaison. Right. Sometimes you might have 4 or 5 people on your team communicating with 4 or 5 people on their team. Okay. So then now there's like a lot of traffic flow between different [00:22:00] people. So let's say that they have a brand new like AP person. And you are you assign the testing of AP because it's a little bit easier section to test. You assign it to a new person. A very inexperienced person is communicating with a very inexperienced experienced, a very inexperienced person. Sometimes we can have issues there, especially when we come back after fieldwork and we start reviewing things. So having kind of a point person, someone, you know, kind of like an air traffic controller assigned, you know, usually the in charge, the senior can do that, uh, [00:22:30] should do that. And a lot of times we want to kind of have it, you know, maybe a little bit of organization on the client side if possible. Um, so they kind of have their main person, which let's say could be the CFO or someone in charge of their accounting on our on our end. It's the audit senior. That's a good scenario to be in. So someone's kind of like watching things as they move back and forth.
Sam Mansour: Um, some clients will just say, yeah, go ahead and just deal with my team and go ask people, you know, for whatever you want. The [00:23:00] interesting thing about that is that people like on like let's say, let's say we don't get something during field work and we have it as an open item and we need to collect it later. The CFO might go to their team members and say, well, why do you have so many open items? Why didn't you guys provide these to the auditors? And this is so strange. But like 90% of the time they'll always say, we did that. Tell the CFO that, then the CFO, I'm just using them as a, you know, it could be a controller or whoever. The CFO then calls up the audit in charge [00:23:30] and says, well, my team says they gave it to you. I'm like, I'm like, I have no way of verifying this, you know? So it's like it's kind of like, I feel like we're in the wrong. They're trusting their team. I'm not saying their team is lying necessarily, but it just puts us in a really tricky situation. So it's really good to kind of have a gatekeeper as much as possible on both ends, verifying kind of that, I guess, like liaison on the client side is really important.
Abdullah Mansour: Would it ever not be the lead liaison, ever be [00:24:00] for some reason? Is it maybe if the team's like large enough that with that liaison ever be um, some of those assisting to lead that audit or.
Sam Mansour: Yeah, absolutely.
Abdullah Mansour: Always be.
Sam Mansour: Yeah. If you're on a really big engagement, you might have a you know, let's say it's a massive client and you have like the partner leading the engagement and you have a couple managers on there. And so they might kind of divvy out the sections. So it doesn't have to just be one person, you know, overseeing the whole thing, because sometimes [00:24:30] it could just be too cumbersome. Um, but I think it kind of comes down to like, think about it, what makes sense kind of thing. And then as we mentioned before, Um, so again, like so tips on keeping the process smooth. Um, we mentioned this a lot before, but send the PBC list as early as possible. I cannot emphasize this enough. I mean, there will be a point where it's like it's too early. It's like six months out. Okay. That's like they're not even going to look at it. But if you're, you [00:25:00] know, let's say you're getting past year end and you think, hey, this is a good time to kind of alert them to put the audit, like, think about the audit. Think about the audit, you know, send it out initially. Wait a month or a couple weeks, like whatever is appropriate. Send out a reminder. Ask them if you have any questions. I you want to confirm their understanding. I like to ask the question. You know, I send you this list. This is a good opportunity now that we're not in the muck of things, for you to kind of review and let me know if you have any questions. Does anything [00:25:30] not make sense? Is there anything unclear? Do you think anything's missing? Like, talk to me about it now. Um, I try to prompt them to do that. And then I would.
Abdullah Mansour: Also be prepared.
Sam Mansour: To be very prepared. And I'll also agree on delivery dates. So we talked about this before. Right. If you break out the PVC list into sections, which I like to use the PVC list as my tracker to, then you want to have delivery dates. So like let's say we ask for all the you know we mentioned this before a one through a ten. [00:26:00] Let's say that's a section. They're supposed to get that to us by specific date. Then we tell them, once you give us all that stuff, we'll send you samples within one week, then B section comes due, right? And so on. Um, and then after you give us B section, then return the samples that we asked for after the A section to us, you know, and kind of like staggering it that way. What I, what I like to do in Excel is pick the fieldwork date and then back up from there, use a formula to say, okay, I [00:26:30] want all planning documents from the client 30 days before fieldwork or whatever it might be for you, right?
Abdullah Mansour: Yeah.
Sam Mansour: And then I want this next section to be three weeks and you kind of adjust it like that. And so my formulas in the, in these trackers and, and PBC lists can be automated. But just because they auto populate based on a field work date doesn't necessarily mean that the client is going to agree with them. So so leading up to field work, you want [00:27:00] to make sure that they agree with all the dates prior to that because then that makes field work successful, right? You don't want them to come to a date and pass it and then say, well that was just never reasonable right to begin with. Like you don't want them to say that because then it affects your ability to do field work timely and properly and efficiently. So what I like to do is in that, that when I, when, when I'm, when I'm on a call with them like this and I say, hey, when do you want to do field work? They [00:27:30] pull up their schedule. I pull up my schedule. They say, we want to do it this this date this week. This is super important I screen share this tracker, this PBC list, whatever you want to call it. I put that field work day in and I show them how. It then updates each of the sections. I need A1 by this I need. So then it pulls that that field work date. That's like really kind of far in the future in their mind. It brings the deliverables way closer to them. They're like oh wow, I actually [00:28:00] have to get you all this stuff in the next three weeks because that's our first deliverable based on our field work day. It really helps them see that. And so they should be in agreement, which with each of those deliverable dates and then provide daily updates to clients on what's still outstanding.
Sam Mansour: This keeps them accountable and avoids last minute scrambles. So a big thing that I have found is that people will be waiting on like like throughout field work, we'll say, hey, we're missing [00:28:30] this. Hey, we didn't get this sample. Hey, we didn't get this invoice. Hey, we didn't get, you know, whatever. And so we started to kind of accumulate things that are They're missing, um, that we need. The client is not going to be very pleased if you wait until, like, you know, five hours before you have to get on a plane and you're like, here's all the stuff I still need to provide to me this week. They're like, uh, you want me to pull it together in the next five hours for you? That's crazy. Maybe even less time. You have to get on a plane. So you [00:29:00] want to tell them, hey, like, I'm not trying to be, you know, obnoxious. Basically, if you can make it sound nicer than that. But I will be providing you with daily updates. So again, if you have that PBC list and you have that tracker, what I like to do is at the bottom of my PBC list, have my open items list. And so then as the team discovers things that they're missing, they can go into this like on a Google Drive type scenario and add in, you know, copy [00:29:30] in the sample that they're missing and put it into that, that Excel. And I tell the client ID that ended every day. Please go and look in there and see the things that are still outstanding. So then they can on a on a live basis, see what they still need to give us.
Abdullah Mansour: Can I give you the. Yeah. Yeah.
Sam Mansour: So it's live. It's live right. We test AP. We're missing five invoices. They don't have to wonder, right? We could.
Abdullah Mansour: Just. [00:30:00] Yeah. It seems extremely transparent to. It's like this is just what we need. Uh, yeah. I love.
Sam Mansour: That we just walk.
Abdullah Mansour: Down.
Sam Mansour: Yeah, we can walk down the hallway and say, hey, I'm done testing accounts payable. I'm missing some invoices. And then the client, instead of saying, well, which ones, you know, they should automatically know, just go to that shared PBC list that we're we're tracking the audit. And at the bottom you'll see the open items. Go there and you'll see that section. And so we're wanting to regularly [00:30:30] ideally you know I mean sometimes too many interruptions to the client is frustrating to them. So maybe it's not when we finish each section, but maybe it is depending on the client. But at a minimum, at the end of every day, they should know that they can go in there, um, and see that. And then I would encourage open communication. If they're struggling with a request, it's better to discuss it than ignore it. Some things like we can't, we as auditors will ask for that. To us it [00:31:00] seems intuitive. It seems simple, seems easy. It's like, why not just go get that? But for whatever reason, it's stressful for them. They they they can't get it. They don't know where it is. They're new to the position. They've never seen it before. It's a calculation that someone had come up with in the past, and they don't know how to recreate it. And they just like they've been looking through files for the last month and they can't figure it out.
Sam Mansour: And they're just so stressed out about having this professional. And we mentioned this before, having this professional but approachable tone and [00:31:30] communication. The approachable part should be Look, if you're not sure about something, maybe I have it from last year as an auditor. Right. So let's say it's a calculation to post some kind of a journal entry. And they're new to the position. It's a really convoluted thing. Maybe you hopefully you would have documented that calculation last year how they arrived at it. So you can support your support, your work papers. So it comes back to good, good documentation. So during field work you don't want [00:32:00] them to ignore too many of these things, right. And just say, oh, I'll deal with it later. I'll deal with later because they don't have a good answer to it, because then those are ultimately when we leave the field, what causes audit delays or reports being issued or we come right up against the deadline because if they have a hard time with them during field work or during the planning stage, it's probably not necessarily going to get any easier later. So we want to be kind of there as a as a support system.
Abdullah Mansour: Yeah, [00:32:30] that totally makes sense. What about managers. What what role do they play during this phase?
Sam Mansour: Yeah. So I think this kind of comes back to, you know, good leadership. And so we're talking a lot about like I would say soft skills here. But what I always tell people is the soft skills side of accounting, of auditing of tax is where most people have the biggest problems. So that manager, that leader, like what are some [00:33:00] good qualities of a manager? A leader being present, visible and supportive. So if it's a remote audit and let's say people are the way that we work is we work out of our own homes and we don't have a central office, and we're not going to the client for whatever reason, for the manager to just digitally assign everything and say, go at it. I mean, with a really experienced team, okay, fine, it might work. Okay.
Abdullah Mansour: Yeah.
Sam Mansour: But especially if you have different [00:33:30] levels of people you want to be present. You want to. They want you want you want to get on. As we mentioned, those check in calls. You want to be talking to the client, you want to be there and available, and you want to be supportive as like different scenarios come up. But don't wait until the end to review. Review in phases as soon as sections are completed. This is actually kind of an interesting, you know, debate that I've had in the past with different, uh, people [00:34:00] and, you know, and different firms. Do you send the senior level person out with a lot of heavy testing and heavy work in the field, or do you send them out with availability and the ability to review work papers? So in one scenario, the senior or the the person on site serves as like another team member. They're just testing. They're so busy testing that they actually can't review anything during field work. Some people find that to be very efficient [00:34:30] because it's a body on site that is serving a purpose, right? They're testing workpapers so we don't have to send another body out. Or we can free up that person and send an extra auditor out there and have that senior or or manager, whoever they might be, be reviewing during field work. And it's actually it's nice because then you can you can get kind of closer. Right. Maybe wrapping up a job during field work, when you come back, you just move on to the next job instead of having to spend [00:35:00] the next week trying to wrap it up and then having questions.
Sam Mansour: And if you're reviewing it as you go, then you can ask the client, let's say, like you discover that a newer team members auditing a section and they didn't maybe get collecting the necessary information, or they documented an inquiry and you read it and you're like, ah, that's kind of missing some information. It's so much easier to go back to that person and say, hey, can you go ask the client about X, y, z? Like, it's so much easier to do that then having to say, can you call the client back up and schedule a time to [00:35:30] go collect that information. Managers should be checking in daily with SaaS and weekly at least weekly with a client. Um, if something's off, um, scope drift, missing information, miscommunication. You know, step in early. And the managers also you know, they set the tone. They are the leaders. So if they if they're calm and solution oriented, the team, uh, follows suit. And I have found this, you know, as an auditor myself on many engagements where some [00:36:00] seniors like when I was a staff, I was like, oh my gosh, like, I hate going out with this person. They're disorganized. They're so stressed out all the time. Other people are calm, organized, collected. Their work is efficient. It's such a being a team member on on audits like that. It's so nice because you're not stressed out, right. We're just going to look at.
Abdullah Mansour: Your.
Sam Mansour: Test sections like it's not the end of the world.
Abdullah Mansour: Yeah, totally makes sense on the on the scope drift. That's really interesting. And I'd be curious to hear more about [00:36:30] how that affects an audit. And we've kind of touched on it here and there, but maybe we should do an episode at some point on scope drift and how to avoid it.
Sam Mansour: Yeah, I mean, I think it's pretty easy to to have that happen, you know, in audits sometimes a little bit less so than maybe some of the other like accounting work that we do. But yeah, sometimes you encounter some things that you feel are out of scope. And um.
Abdullah Mansour: It's hard to stay on track.
Sam Mansour: And yeah, you don't know what to do. And so maybe it's a communication with a client and kind of increasing the size of the engagement. [00:37:00]
Abdullah Mansour: Well, Sam, can you give us an example of a field work phase that went off the rails and how it could have been prevented?
Sam Mansour: Yeah. So, I mean, we kind of talked about this a little bit, but, um.
Abdullah Mansour: Yeah.
Sam Mansour: You know, an example would be where someone was assigned to monitor the tracker, um, a handful of key, you know, PBC items were delayed and no one really flagged it. Um, so, of course, you know, we get back from field work and we're like, oh, shoot, where, where where are these he's at. So it's not [00:37:30] any one specific example, but I have seen it happen a lot where we don't assign someone to keep an eye on our end. An eye on that tracker up, and we come back. And that's where, you know, things fall through the cracks because no one's kind of looking at it as a whole. Everyone's just looking at their section. And so you forget to assign a section, no one's looking at it. And that section actually never gets tested like we've had, you know, sometimes, you know, situations where it's like, shoot, who tested that? I [00:38:00] mean, thankfully we had someone that did, but but it's just like it can still be very concerning. Right. If you don't have a very concerning.
Abdullah Mansour: Yeah. Well, what does it look like when field work is done. Right.
Sam Mansour: Yeah. I mean, I think based on a lot of the stuff we've discussed, you know, you can kind of take from that, um, some good habits and what, what good field work looks like. But I would say, you know, everyone knows their responsibilities. Progress throughout the engagement is visible. It's clear we're kind of operating as a team. People [00:38:30] aren't in silos. The team is aligned and confident because issues are resolved in real time. You don't have to worry about what's not done when you get back or getting review comments when you get back and you're like, oh, shoot, like, how am I going to get this from the client now? Right. It's better to be proactive about it.
Abdullah Mansour: Yeah.
Sam Mansour: Clients stay informed, deliver on time and feel respected. So I think there is a lot to be said about working with them, communicating with them, keeping them involved. We've had peer reviewers come into our office sometimes, [00:39:00] and they just close the door and they're there for a week and I'm like, oh my gosh, like, is the world coming to an end? The only time I see him is when they're having lunch with us, you know? So I think I think it's good to just be open and communicative and, and so that they feel, you know, you're coming in, they're looking at their work. And so they might think their job is on the line. So you want to be, you know, open. Yeah. That makes field work go a lot better. And then it can be. Yeah. And I've I've I've really appreciated the feeling, I guess, of what clients might go through [00:39:30] by by us going through peer reviews, you know, and and experiencing that stress myself. And then finally, engagement wrap ups with fewer reviews, with fewer review notes on schedule and with with less stress for everyone. When we have good field work, we have less review notes. People don't feel as stressed out about that, and it's a little bit more predictable. When we get done with field work, we feel good versus getting done with field work, and you're kind of like, shoot, am I going to get some emails here? It's kind of it's kind of scary. [00:40:00]
Abdullah Mansour: Yeah, well that's great. That's a strong case for investing time and planning field work better. Thanks, Sam. When we come back for episode eight, we'll get into one of the biggest capacity killers in audit firms. Review bottlenecks and how to fix them. See you then.