An assessment of teleworking on audit firms in view of COVID-19

Abstract

PURPOSE: The objectives of this study are (i) to examine the extent of how teleworking was implemented in selected audit firms; (ii) to analyse the key challenges and potential opportunities experienced during such a period, from the employees’ and audit firms’ perspectives; and (iii) to evaluate the future of teleworking arrangements beyond this pandemic. DESIGN: To achieve the objectives of this study, a qualitative research method was adopted, where semi-structured interviews were conducted with twenty participants from eight different audit firms; four big-four and four mid-tiers. The participants comprised of one director, five senior managers, twelve senior associates, and two associates. FINDINGS: The findings indicate that teleworking was implemented quite efficiently by management and audit firms since most of the support, communication, and trust that were needed for auditors to continue their work commitments during such a pandemic were provided. Nonetheless, auditors and audit firms experienced both opportunities and challenges during such a period. The main opportunities were higher individual productivity levels and an increase in flexibility and work-life balance, whilst job satisfaction was mainly criticised by auditors. The opportunities experienced by audit firms were a reduction in expenses; a decrease in absenteeism, and an increase in the collaborative drive between management and the workforce, with the latter having a mixed sentiment. Conversely, inventory count; accessibility of clients’ records; testing the internal controls; lack of knowledge sharing; working longer hours; social isolation; household disturbance; and training were all challenges that were encountered while teleworking. Moreover, loss of management control and monitoring; decrease in the overall productivity; and cyber security risks and confidentiality issues were all challenges that were faced by audit firms while teleworking. Consequently, the findings suggest that the future of teleworking arrangements in audit firms beyond this pandemic will be that of a hybrid nature. CONCLUSIONS: This study concludes that even though Covid-19 forced audit firms to adapt to teleworking overnight, most firms adapted well to this transition and thus were ready to support this procedure. Even though both opportunities and challenges were experienced while teleworking, it can still be said that it brought an effective change and not a devastating one for both auditors and audit firms. Indeed, the opportunities experienced aspired both audit firms and auditors to utilise telework in the future. Thus, the ‘new normal’ post-pandemic will be that of a hybrid nature, giving more leeway and flexibility to the auditors. VALUE: This study adds to the small body of knowledge on the impact of teleworking on both audit firms and auditors during Covid-19. Moreover, it seeks to shed light to all audit firms and auditors, that the future teleworking arrangements should be that of a hybrid nature, providing more flexibility.