Set against the background of our recent request for tender, along with receiving each firm’s written proposal, I wanted to make sure I eyeballed the people involved. Each firm came in and spoke to me three or four times before the presentation to the audit and risk committee. I wanted to put them in the best possible position with the committee so they could convey clearly the benefits and style of their services, so we had a dry run so to speak. They would each give their presentation and then I would highlight certain items, “OK, this is the situation: we’ve got a material difference on a signifi cant item. You and I don’t agree. How are you going to communicate that to the committee? How are you going to communicate to the audit team who’s sitting next to me? Are you going straight to him or are you going to come and work with me? How does your process work?”
This process was valuable. Poking each firm like that showed real differences in
their style, content and cultural fit with our business. It was really interesting. What
I’m really looking for in the final analysis is how they communicate and how their
process works when they end up in a difference of view with me as the CFO.
An interesting approach.
What were some of the items on your scoring sheet used to assess each firm?
We looked at things like communication style, cultural profile, demonstrated experience
and expertise, strategies and infrastructure to deliver the external audit services, quality processes, audit team composition, the audit fee, firm independence, international
delivery capacity, how they would handle matters of material significance, and what other non-audit services they would be able to provide.
With this last item, I’m not talking about tax and advisory but rather what things would they be able bring to the table that they are not necessarily going to charge us for … things
like thought leadership, executive networks, training and updates, and the like. We also looked at how they communicated with the audit committee and the management team, their transition plan from our audit existing firm and then finally, how we felt about their presentation.