Auditor-client meetings and their effectiveness

Abstract

This dissertation studies the nature of auditor-client meetings held throughout the course of an audit and considers the effectiveness of their conduct. The key research objectives are: • To assess meetings being held between auditors and their clients in Malta; • To evaluate the effectiveness of such meetings; and, • To identify and recommend possible changes to current practice so as to improve the conduct of such meetings. Data for the study was compiled from twelve interviews conducted with four Big-4 audit managers and eight medium-sized audit partners. A mail survey was also carried out amongst a random sample of entities representing the clientele of the participating audit firms. Valid questionnaire responses were received from 63 Big-4 audit firms' clients, and 33 medium-sized audit firms' clients. The study concludes that in the local scenario, face-to-face meetings play an important role in the communication process between the auditor and his client. Meetings are held at each stage of the audit but those held at the planning stage tend to be the most important for the auditors. Most of the auditors asserted that the planning stage meetings are crucial to create an effective audit plan. On the other hand, clients find meetings most useful at the end of the audit. Clients are primarily interested in the findings and any recommendations for improvement which the auditor may pass on during such meetings. Another outcome of the study is that meetings are managed in a quite efficient manner. Sufficient preparation and follow-up to such meetings is carried out and the principal factors necessary for an effective meeting are present in the way meetings are currently conducted. Furthermore, the study reveals that clients appreciate such auditor-client meetings. They come prepared and participate during such meetings.