Most recent audit regulation makes recruiting tougher

The new audit rules introduced after the financial crisis are transforming the way that recruiters and managers hire, train and promote accountants and compliance officers.

Regarding this matter, Gavin Aspden, director of qualifications at the Institute of Chartered Accountants in England and Wales (ICAEW) has declared recently: “Demands on new staff are far greater than at any other time in the accounting profession’s history,”

Also he added:  “Not only are chartered accountants facing lots of regulatory changes – they are coming at a rapid rate. This is having an impact on how employers are recruiting and the learning and development needs of trainee chartered accountants.”

Due to new limits on the length of the relationships auditors may enjoy with their clients, nearly twice as many FTSE 350 businesses are expected to tender auditor mandates this year compared with last year. PwC, the accounting group, expects up to 56 audit tenders of FTSE 350 companies this year, compared with 30 in 2013 and 18 in 2012.

This is changing who and how audit and financial services firms recruit.

For example, Gillian Lord, UK head of regulatory affairs at PwC, agrees much more is now being asked of auditors, which means they need to have greater and more varied technical skills. He affirmed: “We need a different range of people.”

Also, Panos Kakoullis, the UK’s managing partner for audit at Deloitte, believes audits have moved away from a “checklist mentality” to one where the auditor’s inquiring and challenging mind is the important attribute. However he warns: “Improving audit quality is not a journey because there is no end.”

As professional services firms grapple with those changes, they are also helping their clients deal with the very same upheaval.

Furthermore, James Woodhouse, Accenture’s head of finance and risk services for the UK and Ireland declared: “We are investing heavily in regulatory research and analysis so our people can help banks, insurers and the regulators themselves navigate, execute and operate in simpler ways,” says

“Regulation is almost completely dominating the agenda and is affecting the very structure of the financial services industry. Our clients need to face these regulatory challenges at the same time as helping their clients and continuing to make money. That’s a hard balance”

The increase in the demand for – and the pressure on – auditors could spell trouble, says Mr Aspden. They could be considered “shockwaves in the profession”, leading “aspiring accountants to interpret the changes as a sign that the profession needs fixing – potentially scaring them off”, he concluded.

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