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Kreston Reeves, Accounting Excellence Progressive Audit Team of the Year | AccountingWEB
Accounting-Excellence

A sense of purpose is key to audit excellence

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Crowned Progressive Audit Team of the Year in 2023, Kreston Reeves attributes its success to a strong sense of purpose, staff development and a continuous improvement culture.

3rd Jun 2024
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The audit sector has faced significant scrutiny over the years, with high-profile collapses like Carillion and BHS casting a shadow over the industry. However, Kreston Reeves (pictured above), the winner of the inaugural Progressive Audit Team of the Year at the 2023 Accounting Excellence Awards, is determined to change this perception.

A purpose-driven approach

Michael Cook, corporate audit and business advisory partner at Kreston Reeves, emphasises that the firm’s sense of purpose is a key driver of its success. As a certified B Corp organisation, Kreston Reeves is committed to thinking carefully about the selection of clients and the sectors they’re in, ensuring alignment with their values.  

This commitment led the award-winning firm to undertake an exercise to “cut the tail” of their client list, removing some clients that did not align with their values or that the audit teams felt uncomfortable working with or where they didn’t have the resources to serve them.  

“Having that set of values and cultures and a purpose that’s clearly defined helps our younger people to come on the journey with us,” Cook explained.  

The human element in audit

This gets right to the heart of how Kreston Reeves is approaching audit. The audit profession is a people-based business. 

So while it’s important as a progressive firm to innovate and use technology, Cook emphasised that this shouldn’t replace the fundamentals. 

“We’re in a people industry and whatever technology or automation we use, we still talk to our clients and deliver services – whether that’s preparing audit reports or advice. The tech part allows us to bridge the resource gap and be more efficient.”  

Embracing technology

Technology plays a pivotal role in Kreston Reeves’s audit services. The firm collaborates with suppliers like Circit, DataSnipper, CaseWare and MindBridge on data analytics. He said as an employer, trainees expect this kind of technological assistance. 

An innovation team works closely with these suppliers, trialling software across all levels of the business, from first-year trainees to audit partners.

“The audit market is heading for huge changes in processes, and we want to help drive this with the suppliers we work with through our ideas. We debate with suppliers on product improvements and have become a go-to for feedback when they are looking to release new products,” said Cook. 

He continued: “The feedback from everybody is fundamental. Our audit trainees will be using this software for audit testing so we have to hear what they think about it. Even though we have a real commitment to innovation and tech as being part of our audit solutions in the future, we get everybody at every level – every different type of person within our audit team – to be represented as part of that trial.”

Commitment to continuous improvement

The audit team at Kreston Reeves maintains a continuous improvement mindset, which is essential in an industry where internal controls are always under scrutiny. 

To support this, they recently hired a technical quality director, previously from KPMG’s tech team, to lead a non-chargeable technical support team. This team focuses on applying technology and automation, improving their methodology and adapting to changing audit standards.

As such, Cook highlighted the need to balance audit requirements with profitability, staff development, technology integration and audit quality. “These are not things you can do in your spare time. They have to be your fundamental role,” he said.

“If you’re a client-facing auditor, you can’t really do a full-time quality control or a full-time innovation role. So we have to put people in place and give them the time to do this stuff.”

Promoting work-life balance

Understanding the importance of work-life balance, Kreston Reeves is committed to ensuring their audit team is not overstretched. 

“We’re really committed to trying to provide a good work-life balance because everybody works too hard. That’s where technology like DataSnipper can come in and take three to four hours off a ‘tick and bash’ test, and then our guys can do the more interesting, analytical work rather than the grunt work.” 

Staff engagement and development

In response to the industry-wide staff shortages and excessive hours driving auditors out of the sector, Kreston Reeves has prioritised staff engagement and development.  

The firm has done this through annual people engagement surveys, staff forums, 360 reviews and regular open internal communication such as town halls and reverse mentoring. 

This is a different world to the one Cook started in, where trainees were asked to do whatever it took and, he joked, it wouldn’t be unusual to have files thrown at you. 

With poor audit culture often to blame for high fines and sanctions, these firm-wide engagement initiatives may also contribute to creating an environment that empowers staff to speak up and ask questions. Cook gets a lot out of reverse mentoring because you can see other people’s daily challenges and he noted that it’s useful in building a trusting relationship with staff. 

“I did reverse mentoring almost out of curiosity four or five years ago, but it’s been remarkable – it’s been one of the best things I’ve ever done. 

“They tell you what’s not working – often operational stuff or how we use software – and I would not have known about it had we not engaged in that process.”  

After a junior auditor at KPMG took the rap for not standing up to their seniors as part of the audit of the Carillion group, the staff engagement programmes go some way to establish a culture of transparency and a safe space to challenge. 

Client engagement

Kreston Reeves extends a similar level of care to their clients, too. They regularly seek feedback from clients through one-to-one interviews, annual client care surveys and a client care steering group that oversees client care and drives improvements. 

An independent external consultant is currently conducting a client listening campaign, which is purely in audit at the moment. The external consultant visits clients and over the course of a 45-minute conversation, explores areas such as how proactive the firm is and how well they know their clients’ business. “It just unlocks any potential service issues,” explained Cook. 

In one recent feedback from this session, a client was generally positive about the service, although flagged that the audit is completely remote. This has been happening since 2020 and the firm was under the impression that the client liked this.

In touch with the fundamentals

In an industry tainted by high-profile audit scandals, progressive auditors have to hold themselves to higher standards. 

What Kreston Reeves has demonstrated is that although they are not sitting on their hands, and they are innovating, they haven’t lost touch with the fundamentals. 

Their dedication to a strong sense of purpose permeates into every aspect of the service line from engaging and challenging suppliers to fostering trust with clients and promoting a culture rooted in their values. 

But ultimately, this sense of purpose is driven by being a people-based business. This was no better demonstrated than Cook’s reaction to winning the Accounting Excellence award. “It was a lovely thing to be able to say to the team and to say thank you – everyone contributed to doing this and it made us all very proud.”

Could you win the Progressive Audit Team of the Year Award this year? Enter the Accounting Excellence Awards now. Entries close on 14 June. 

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