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Audit approach overview
Our audit approach will allow our client's accounting personnel to make the maximum contribution to the audit effort without compromising their ongoing responsibilities
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Annual and short period audit
At P&A Grant Thornton, we provide annual and short period financial statement audit services that go beyond the normal expectations of our clients. We believe strongly that our best work comes from combining outstanding technical expertise, knowledge and ability with exceptional client-focused service.
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Review engagement
A review involves limited investigation with a narrower scope than an audit, and is undertaken for the purpose of providing limited assurance that the management’s representations are in accordance with identified financial reporting standards. Our professionals recognize that in order to conduct a quality financial statement review, it is important to look beyond the accounting entries to the underlying activities and operations that give rise to them.
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Other Related Services
We make it a point to keep our clients abreast of the developments and updates relating to the growing complexities in the accounting world. We offer seminars and trainings on audit- and tax-related matters, such as updates on Accounting Standards, new pronouncements and Bureau of Internal Revenue (BIR) issuances, as well as other developments that affect our clients’ businesses.
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Tax advisory
With our knowledge of tax laws and audit procedures, we help safeguard the substantive and procedural rights of taxpayers and prevent unwarranted assessments.
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Tax compliance
We aim to minimize the impact of taxation, enabling you to maximize your potential savings and to expand your business.
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Corporate services
For clients that want to do business in the Philippines, we assist in determining the appropriate and tax-efficient operating business or investment vehicle and structure to address the objectives of the investor, as well as related incorporation issues.
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Tax education and advocacy
Our advocacy work focuses on clarifying the interpretation of laws and regulations, suggesting measures to increasingly ease tax compliance, and protecting taxpayer’s rights.
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Business risk services
Our business risk services cover a wide range of solutions that assist you in identifying, addressing and monitoring risks in your business. Such solutions include external quality assessments of your Internal Audit activities' conformance with standards as well as evaluating its readiness for such an external assessment.
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Business consulting services
Our business consulting services are aimed at addressing concerns in your operations, processes and systems. Using our extensive knowledge of various industries, we can take a close look at your business processes as we create solutions that can help you mitigate risks to meet your objectives, promote efficiency, and beef up controls.
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Transaction services
Transaction advisory includes all of our services specifically directed at assisting in investment, mergers and acquisitions, and financing transactions between and among businesses, lenders and governments. Such services include, among others, due diligence reviews, project feasibility studies, financial modelling, model audits and valuation.
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Forensic advisory
Our forensic advisory services include assessing your vulnerability to fraud and identifying fraud risk factors, and recommending practical solutions to eliminate the gaps. We also provide investigative services to detect and quantify fraud and corruption and to trace assets and data that may have been lost in a fraud event.
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Cyber advisory
Our focus is to help you identify and manage the cyber risks you might be facing within your organization. Our team can provide detailed, actionable insight that incorporates industry best practices and standards to strengthen your cybersecurity position and help you make informed decisions.
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ProActive Hotline
Providing support in preventing and detecting fraud by creating a safe and secure whistleblowing system to promote integrity and honesty in the organisation.
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Accounting services
At P&A Grant Thornton, we handle accounting services for several companies from a wide range of industries. Our approach is highly flexible. You may opt to outsource all your accounting functions, or pass on to us choice activities.
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Staff augmentation services
We offer Staff Augmentation services where our staff, under the direction and supervision of the company’s officers, perform accounting and accounting-related work.
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Payroll Processing
Payroll processing services are provided by P&A Grant Thornton Outsourcing Inc. More and more companies are beginning to realize the benefits of outsourcing their noncore activities, and the first to be outsourced is usually the payroll function. Payroll is easy to carve out from the rest of the business since it is usually independent of the other activities or functions within the Accounting Department.
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Our values
Grant Thornton prides itself on being a values-driven organisation and we have more than 38,500 people in over 130 countries who are passionately committed to these values.
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Global culture
Our people tell us that our global culture is one of the biggest attractions of a career with Grant Thornton.
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Learning & development
At Grant Thornton we believe learning and development opportunities allow you to perform at your best every day. And when you are at your best, we are the best at serving our clients
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Global talent mobility
One of the biggest attractions of a career with Grant Thornton is the opportunity to work on cross-border projects all over the world.
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Diversity
Diversity helps us meet the demands of a changing world. We value the fact that our people come from all walks of life and that this diversity of experience and perspective makes our organisation stronger as a result.
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In the community
Many Grant Thornton member firms provide a range of inspirational and generous services to the communities they serve.
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Fresh Graduates
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Experienced hires
P&A Grant Thornton offers something you can't find anywhere else. This is the opportunity to develop your ideas and thinking while having your efforts recognised from day one. We value the skills and knowledge you bring to Grant Thornton as an experienced professional and look forward to supporting you as you grow you career with our organisation.
Many companies have attempted to improve their financial close process, but most are still burdened with the slow-paced record-to-report cycle even to this day. Some companies take several weeks, or worse, even months, to close their books. I even know of companies that produce a different version of truth every time they generate financial reports, thus, undermining the integrity and reliability of the reports.
In most companies, the financial close process is a frenetic period that requires the temporary setting aside of some finance activities and overtime work for most accounting personnel. This environment increases the level of stress within the department, as well as the risks of errors. And yet, demand by both internal and external users for instant access to updated and reliable financial information will continue to intensify. Thus, the need for a robust financial close process is so important.
There is really no standard solution to the complex issue of the financial close process as different entities may require different approaches. I have listed some activities that I believe can be tried to improve the financial close process based on my experience as an external auditor.
Invest in a good accounting system—Most companies still primarily employ a manual method, often using Microsoft Office (Excel). This is not reliable in the long run as spreadsheets can break, and formulas can be overridden. A number of less expensive but more reliable off-the-shelf accounting systems are now available in the market. Companies need to carefully evaluate the accounting systems suitable to their business. To accomplish full computerization in the office, there should be thorough commitment among the people.
Invest in quality people—Management should view the accounting department not as a cost center but rather as a business strategy partner. It is important to invest in highly competent accounting personnel, especially with the choice of chief finance officer (CFO) or head of accounting, considering that they will provide the updated and accurate financial reports needed for strategy formulation and decision-making.
Record all financial transactions judiciously—Ideally, financial transactions should be thoroughly recorded as they transpire. It is critical for the accounting department to establish confident partnerships and good working relationships across departments, given that some transactions are processed by departments other than the accounting, and coordination among them is very crucial.
Complete the reconciliations regularly—In my experience as an external auditor, bank reconciliation statements are submitted notoriously late. Ideally, bank reconciliation should be done on a monthly basis. Companies with no regular bank reconciliation statements usually have to provide numerous adjusting entries during the financial close. Entities should also perform intercompany reconciliation regularly. Ironically, intercompany transactions are oftentimes taken for granted and not monitored regularly, thereby causing delay in the finalization of the financial statements. Sometimes, two related parties treat the same transaction differently, even though their accountants work in the same office.
In some cases, certain transactions or reconciliations cannot be processed because the necessary information is not yet obtained—either from another department or a third party. Instead of passively waiting for the information to arrive, evaluate and look for ways on how to get the information much faster. Alternative approaches could be considered, such as making an estimate of an account balance based on historical results or deriving data from other sources.
Start the close process before the period ends—Some accountants consider the first day of the following month as the start of their month-end activities. This traditional way of thinking needs to be changed by starting the close cycle days before the month-end. There are activities that can be done before the end of the month such as determining the allowance for doubtful accounts; computing for depreciation expense; and preparing pre-payment amortization and accruals where the amount does not vary monthly.
Analyze the causes of post-closing adjusting journal entries—Ideally, post-closing adjusting journal entries should be at the minimum, but in some cases, I have encountered entities with adjusting journal entries reaching to a hundred. In most cases, adjusting journal entries are used to correct an error. Entities need to investigate what caused these adjusting journal entries. Are there certain errors that continue to occur month after month? Adjusting journal entries may have resulted from the untimely preparation of reconciliation, the incorrect accounting treatment of certain transactions due to unclear or inadequate accounting policy, a lack of understanding or knowledge of accounting personnel on how to treat such transactions, or plain human error. By evaluating the nature of these adjusting journal entries, the company can identify which area they need to address or focus on.
Timely review of the accounting head, or CFO, or similar functions—In some cases, the completion of the financial close process has been delayed due to the absence of the required review. In doing the review, the accounting head or CFO may have to engage more substantial effort in reviewing non-routine transactions and entries involving estimates and judgments as these are areas prone to financial misstatements.
In recent years, regulators have placed more emphasis on the responsibility of the management with regard to financial statements. Availability of financial statements in a timely manner will create an atmosphere of confidence among investors and other stakeholders, and the benefit will eventually redound to the stockholders, management and employees. Therefore, the management should focus on and put resources in a robust financial close process.
Boyet Murcia is a partner, Audit & Assurance of P&A Grant Thornton. P&A Grant Thornton is one of the leading Audit, Tax, Advisory, and Outsourcing firms in the Philippines, with 21 Partners and over 800 staff members. For comments, please email boyet.murica@ph.gt.com or pagrantthornton.marketscomm@ph.gt.com. Visit our Website: www.grantthorn.com.ph; Twitter: pagrantthornton, and FB: P&A Grant Thornton.
As published in The Manila Times, 25 January 2017