The problem with Audit and what the pandemic has done to the profession

I recently asked auditors in my network to complete a poll with the following question – ‘What improvements could be made to your role that would make you stay in audit long-term?’.

I asked this question because I wanted to gain some insight into why accountants are leaving audit roles and what could be done to make a career in Audit more enticing. My colleagues and I in the iMultiply Public Practice team are frequently engaged in conversations with our accountancy firm customers who are struggling to fill their audit vacancies. On the opposite side of the coin, we often speak with newly qualified accountants whose first thought when qualifying is to leave Audit.

The options were Better Compensation, Audit Reform Implementation, Hybrid working, and Fewer working hours.

The results were as follows – Better Compensation 41%, Audit Reform 2%, Hybrid Working 5% and Fewer Working Hours 52%

On the surface, you could see these results as telling us what is blindingly obvious. However, there is probably a little more to unpack here than just people wanting to be paid more and work less.

What do people want?

Firstly, I was slightly surprised by the fact that Audit Reform scored so badly. Maybe the fact that this is still a grey area and the proposals on how and who is going to conduct audits haven’t been 100% defined may mean that auditors can’t see how this is going to impact them.

Hybrid working is now taken as a ‘default setting’ by most in the sector, so this may be the reason for the low score.

When it comes to the two high-scoring options, it is a fact that, in general, the market rate for accountants performing an external audit role is generally lower than in ‘in-house’ Finance roles and in other ‘Practice’ disciplines such as Corporate Finance. However, it is also true that accountants can generally expect to work fewer hours in ‘in-house’ positions, although there will be exceptions to that rule.

I would caveat these results by saying that the nature of working in this sector over the last 12-18 months has been challenging. Not being able to physically interact with your work colleagues and team-mates and spending long hours working from your kitchen table with just you and your laptop will have magnified any feelings of discontentment and brought into focus any real or perceived disparities in pay and working conditions.

What are the next steps?

However, it is realistic to say that newly/recently qualified accountants do have multiple options available to them when it comes to making decisions regarding their career – and many of those opportunities are paying better and have a shorter working week. As we are in the period of ‘The Great Resignation’, it may be that accountancy firms need to look again at the levels of remuneration of offer and how they structure the workload of auditors.

It may also require firms, and the profession in general, to shout a little louder about the career opportunities on offer in Audit or what doors it can open for someone who remains in an audit role for an extensive period.

It is also worth stating that the grass is definitely not always greener on the other side. Sometimes, a higher salary can’t compensate for dull, repetitive work and a role with no career progression opportunities.

Continue the conversation by connecting with one of our consultants today.