“Single preparation”, a partial alternative to single audit?

Minding the buzz-word

“Single audit” has been the word of the year in the audit professions for a while. Especially in public sector, auditees have been complaining about the enormous charge of work which brings no immediate added value to the table. In some cases, up to four separate audit, control or inspection entities are charged with auditing or reviewing the same subject matter, be it processes or projects. This leads to complaints from auditees they are being reviewed too often and have no time left for the operations they were asked to execute.

What is blocking “single audit”?

The problem is that while the concept of a “single audit”, with auditors and evaluators sharing working papers, adapting their planning and making sure no auditable areas are covered multiple times makes sense from the auditees point of view, it doesn’t always bid well with those auditors or evaluators. There are a couple of reasons that come up when discussing this with them:

• independence: by using other auditors’ assessments, we weaken the audits or the assessments. Given we have no influence over their working methods or level of professionalism, and given in some cases they do not need to comply with the same rules and regulations ‘our’ profession has, we are not independent. Therefore, we cannot move to “single audit”
• fees: for external parties, be it external auditors or out- or co-sourced internal auditors, the more you share, the less work remains for you, the less fees you can get from this organization
• scope: sometimes the scope is slightly different and work executed by other auditors or evaluators does not match up with the requirements of our working program
• confidentiality: we cannot share our information due to confidentiality of our working papers and reports

I’m not pronouncing myself on the merits of these points. I just conclude they are there. And that because of these and other objections a “single audit” will likely not become a reality anytime soon. But is there an alternative that may at least aleviate some of the pain felt by the auditees without significantly impacting the independence nor quality of work of the auditors and evaluators?

The concept of “single preparation”

The problem is that the auditee is overburdened by audits, mainly by the audit preparation activities. These involve making information available to the auditors, preparing certain documents, and making sure the relevant discrepancies are adequately documented and explained. They need to do this again and again for every audit, each time preparing pretty much the same information in a comparable format.

A possible way to reduce some of the charge would be the “single preparation”. “Single preparation” would involve a yearly meeting of all auditors and evaluators in which they agree on the basic information requirements for their audits. What needs to be prepared in what format. Bringing these people together would aim at establishing one format for each type of information, with the formal requirement to use the available systems of the auditee as much as possible.

Measuring “single preparation”

Single preparation measurement would involve each audited entity to detail the time spent in preparing each of the elements of information. In addition to giving a good idea on the charge of the work for auditees and improvements year over year in reducing this charge, the information would point to significant time sinks, preparations which take a lot of time of the auditees. This could in turn lead to two solutions:

• the information requirement is redefined by the auditors, resulting in a reduction in the time spent by the auditee, or;
• the auditee and its supporting organization structures, such as ICT, look at more efficient ways of gathering the data and making it available.

A partial solution

“Single preparation” is a partial solution, which does not address the problem of auditors and evaluators not keeping the end in mind of the organization they are auditing. But requiring them to at least do the effort to streamline their information requirements may reduce the burden on the auditees by a bit.