Do Auditors Get Audited?
Businesses and nonprofit organizations that have a financial statement audit already know that the audit process requires a significant commitment of resources and time. But, how do these businesses know that they are getting a good quality audit? Do the auditors ever get audited?
The answer is a definitive yes.
Under our professional standards, LMRPA’s team of auditors consistently undergoes a peer review process to ensure we are up to date on the very latest requirements and follow the best practices within our profession.
How The Peer Review Process Works
At LMRPA, we undergo a standardized review process. Every three years, an external peer reviewer assesses our existing quality control procedures to evaluate the quality of the accounting and auditing work we do. The external peer review is important to not only ensure we don’t miss a step with our clients, but also to ensure we uphold the highest standards of accountability amongst our team.
Additionally, in between the outside peer review cycle, our firm’s personnel perform an internal peer review of some completed engagements. We also put in place a plan to make any improvements recommended by both the external and our internal peer reviewers.
The Benefits of Having Auditors Go Through the Peer Review Process
Consistent peer reviews offer several benefits to both the firm and the firm’s clients. Benefits to the firm include:
- Maintain Quality of Work
Peer reviews can help identify areas where a firm’s quality control procedures may need improvement. By providing an objective evaluation of the firm’s work, a peer review can help identify opportunities to strengthen internal controls and procedures to ensure a higher level of audit quality.
- Improve Internal Processes
Assessing existing processes can help identify operations and practices that are not functioning at optimal levels. Pinpointing areas for improvement ensures that the firm continues to operate using the highest standards of quality.
- Enhanced Credibility
Participating in the peer review process can enhance the credibility of an audit firm. By demonstrating a commitment to quality and accountability, audit firms can build trust with clients and stakeholders.
- Benefits to clients include:
- Commitment to Quality
A firm that undergoes consistent peer reviews demonstrates a commitment to quality and accountability to their clients. This commitment to maintaining the highest standards of excellence can help build trust with clients, partners, and stakeholders.
- Focus on Improvement
Undergoing routine peer reviews also shows clients that their chosen firm prioritizes a focus on continuous process improvement.
- Confidence in Results
Most importantly, clients can have greater confidence in audit results knowing that an independent party has reviewed the work of the audit firm. This confidence can help clients make better-informed decisions based on the audit results they receive, as well as help mitigate any concerns about potential biases or conflicts of interest.
An audit is a big commitment of organizational time and money — it’s critical to ensure you are getting the most out of your investment.