In some work environments, a new auditor is expected to hit the ground running! Here is your assignment, newbie. Now go!
My audit supervisor in my first professional job in public accounting expected that of me. She literally gave me last year’s working papers and told me to replicate them in half the time of the prior year’s auditor.
I later learned that auditors call that the S.A.L.Y. approach to auditing – Same As Last Year. It is dangerous to ask a new auditor to take a SALY approach to their work.
Why? Because SALY doesn’t take into account changes in the client’s environment.
It assumes that the auditor last year knew what he was doing (and he in turn assumed the auditor before him knew what she was doing and so on and so on).
And it keeps the new auditor’s nose to the grindstone, which means they aren’t thinking about what they are doing or why they are doing it. A huge risk could stand right in front of a new auditor and wave its arms, but the new auditor probably wouldn’t see it because they are so focused on getting the work done on time!
Keep your expectations in check
Soon, I got very tired of being treated like a mushroom (you know, fed crap and kept in the dark). It was as if my audit manager expected me to miraculously know everything she knew, although I had obviously just graduated college and was new and green.
I moved on to a job where someone was willing to answer my questions and fill in the blanks for me. In part, because of this negative experience, I am a firm believer in telling a new auditor WHY they are doing what they are doing. Tell them everything!
No, they may not fully understand or absorb what you are saying the first time, but sharing why you are asking them to perform tasks will eventually pay off in the new auditor being able to do the task without your prompting.
New auditors are using their brain!
I often hear audit leaders complain that the staff is not using their brain. And that is simply not true; they are just using their brain to get on top of the basics of how an audit works.
In the same way, while it doesn’t look like a baby is doing much, child development research tells us they are doing a crazy amount of learning with their young brain. You don’t expect a 6-year-old to drive his car to his programming job at Google, do you? First he needs to learn how to dress and feed himself.
So have a little patience and give the new auditor some time. Feed them the knowledge and experiences they need to expand their capacity and you will both reap a harvest!
The GAO’s Yellow Book tells us that new auditors (whom they call nonsupervisory auditors) should not be expected to handle an audit all on their own because they need more time to master the basics before they can move on into audit supervision:
GAGAS 4.10 a. Nonsupervisory auditors: Auditors in these roles plan or perform engagement procedures. Work situations for these auditors are characterized by low levels of ambiguity, complexity, and uncertainty. The nonsupervisory auditor role necessitates at least a basic level of proficiency.
Here are some basics that a new auditor needs to know
If you want your new auditor to move past the basics and into management – if you want them to eventually be trusted to take on an audit all on their own – you need to provide them opportunities to master the basics. Make sure that your new auditor learns:
1. What the steps of the audit are
New auditors need to know a little about every step of an audit in order to give their work context and meaning. No, they don’t need to be able to handle a complex risk assessment on their own, but they sure need to know what one is and why a risk assessment is necessary on every audit.
2. How to write a finding
The new auditor needs to be informed that, at the end of an audit, the audit team delivers two main products: a conclusion to their audit objective and audit findings.
Therefore, the audit conclusion and the elements of a finding should be considered every time an auditor makes a move. Specifically, the auditor should ask themselves, “If I do this task, how will it impact my conclusion and contribute to supporting the elements of a finding?”
But that question right there is an example of higher-level thinking that might be beyond the capacity of a new auditor. So, in order for them to think in that way eventually, they first need to know what an audit conclusion and the elements of a finding are.
3. How to document evidence
A new auditor’s main task is to gather evidence. And then they need to know how to document the evidence they gathered in compliance with auditing standards. This is no small feat, people!
4. How to interview
No matter how green they are, most audit teams allow the newbie to interact with the client. Learning how to get the information they need without upsetting the client is, hands down, the most important skill a new auditor needs to master. Otherwise, the audit managers and leaders will spend all of their time smoothing the client’s feathers instead of getting the audit done.
Therefore, I recommend that the first formal training for a new auditor should center around client relations and interviewing skills. I wrote a self-study book that should help.
5. How to recognize fraud
As you know, auditors must always be on the alert for wrongdoing because, sadly, it is so rampant. And you might expect new auditors to be able to see a fraud going on right in front of their face. But if they don’t know what fraud looks like, they are simply not going to see it. Do us all a favor and show the new auditor what fraud looks like!
Bottom line: if you want a new auditor to contribute as much as possible on your audits, invest more time and energy to get them up to speed with the basics.