From the auditor’s perspective: What does the future of the audit profession look like?

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Amidst a changing landscape, audit professionals at all levels have significant questions about the future of audit and the role that technology like AI plays. To help those looking for answers, we went straight to the source.

Forrestall CPAs is a leading metro Atlanta CPA firm offering a full range of services, including audit. Founded in 1978, the firm was voted the Best CPA Firm in Gwinnett County for fifteen years by Gwinnett Magazine. It was also ranked in the top fastest growing CPA firms in Atlanta for six years by the Atlanta Business Chronicle.

We sat down with Managing Partner Jeff Forrestall, CPA, CFF, ABV, CVA, PFS, for his thoughts on where the audit industry is headed.

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In your opinion, what is the state of the audit profession?

Jeff Forrestall: First, the idea that audit is going away is not the case.

My father started our firm in 1978. He’s an old Ernest & Young guy, so he eventually taught all of us. Everyone started from some national firm group.

We started out doing a little bit of everything, so both audit and tax. We have some other specialty pieces too. The last couple of years, however, our firm has been heavily in audit and, surprisingly, it is now our largest revenue vertical.

I was also a peer reviewer for about 10 years and we are about to get back into that. We used to pay like $2,000-3,000 for peer review and now it’s like $15,000-20,000. So it’s not cheap, especially if you have specialties. I think that’s the same trend as we’re seeing across the industry in the last few years for audit.

It’s all about personalized service.

How do you think AI will transform the audit industry in the next decade?

Jeff Forrestall: In my opinion, it will support more customization and value-based pricing. To do it properly and to make money, you’re not using just your checklist or guidelines, but you need to personalize and really understand your client, see what the trends are, and offer higher end advisor’s work.

If you’re doing pure checklist and not talking to the client, just emailing them something and have them load to the portal, there’s no relationship there. If you treat the product like it’s a commodity, then it’s priced like that.

However, I think it’s the communication and being able to interpret the analysis of your analytics and then communicate it back to the client for better decision-making. That’s the value and you can charge more for it. And technology can support that.

Are you seeing shifts related to training, recruitment and retention in the audit industry?

Jeff Forrestall: We’ve had to look around outside of the traditional path. I have a couple of attorneys on staff and one of my auditors is an attorney. Great hire. Never had an accounting class in her life.

I have a couple of STEM majors who don’t have any kind of background. Younger prospects have jumped jobs a lot due to COVID, so they don’t have the background we need.

We’re looking for more experienced people. And we’re actually home-growing them ourselves with the AuditWatch program. We make everyone go through it.

Long story short, the industry is changing. National and regional firms are traveling auditors to death.

Starting next year, we will work a 40 hour workweek. Our audit groups don’t travel. We’re the only ones because we’re trying to attract and retain people. So within the last six months, I’m seeing a lot of auditors are applying to us again.

What strategies are audit firms using to meet evolving client expectations?

Jeff Forrestall: For us, we started doing these reviews with analytics as a value-add for our clients. For example, here’s a five year trend on yourself. Here are your ratios. Here’s the min, max and mean of everybody in the industry. And they go, wow, man, my overhead is more than everybody else.

We started sharing that report with the client and it’s a huge value to them. It tells a good story.

What role will data analytics play in future auditing processes?

Jeff Forrestall: I’d say audit quality’s going up and I think there’s a correlation because of the use of analytics.

But it won’t replace the role of humans. So, if you’re doing an audit or review, maybe the AI is doing the part of the initial analytics that tell you if something looks odd. Then, you have the human come in and make inquiries with management to determine if we need to have an inquiry, what is the disposition of that inquiry, etc.

How is competition affecting audit fees and service quality?

Jeff Forrestall: I think we’re all evolving and figuring out how to be smarter with less. With less auditors and less firms doing them, fees are going up. But so is quality.

With some of the new products that are out there, like Guided Assurance (formerly Checkpoint Engage), you can tailor your services beyond just a checklist. More planning, more analytics, and better understanding—and realizing the value for that.

Also, more analytics and relying on other opportunities to actually reduce our overall time. That’s where the audit industry is headed.

What skills will future auditors need to succeed?

Jeff Forrestall: It is definitely soft skills because the audit profession is a job that leads to talking to people. That is what this whole thing is about. And I’d say being mentored or mentoring someone else is important.

And it doesn’t mean having an accounting degree is going to make you necessarily any better. I’ve got four people that I’ve hired who have no business degree and they’ve all done very well because we teach them.

Just be inquisitive and ready to learn.

Conclusion: Are you ready for the future of audit?

Learn more about how you can be prepared for the future of the audit profession by downloading our white paper, Modernize your audit practice.

Curious about AI in auditing? Play our risk management challenge and see how AI can transform your audit approach.