As presented to practising members of the Institute of Chartered Accountants, Ghana.

1. PRACTICE MANAGEMENT
PRESENTED BY:
CHARLES EGAN
HEAD REVIEWER,
AUDIT QUALITY
MONITORING
ICAG

2. PRACTICE MANAGEMENT --
AGENDA
OVERVIEW OF REQUIREMENTS,
REGULATION AND STANDARDS
PRACTICE GUIDANCE FOR SMPs – IFAC
GUIDE

3. KEY DISCUSSION TOPICS
OVERVIEW OF REQUIREMENTS, REGULATION AND
STANDARDS
RISK MANAGEMENT
FULL MONITORING
SETTING UP A
PRACTICE
PRACTICE
REGULATIONS
PRACTICE DEVELOPMENT

4. SETTING UP A PRACTICE
 ENGAGING IN PUBLIC PRACTICE?
 REGISTERATION UNDER ACT 151,152 OR 179
 LIMITATIONS UNDER ACT 179 REGISTRATION
 INTEND NOT TO CARRY OUT STATUTORY AUDITS BUT
ONLY OTHER SERVICES?
 ISQC 1
 INTEND TO CARRY OUT STATUTORY AUDITS AND OTHER
SERVICES?
 ISQC 1
 AUDITING SYSTEMS THAT COMPLY WITH ISAs
 FIRM LICENSED BY ICAG?
 DO YOU HAVE A PRACTISING CERTIFICATE?

5. LEGAL COUNSEL’S
CONCLUSION
 There are no LLPs in Ghana;
 A partnership under Act 179
can no longer be deemed a
partnership but a company
and is thus not qualified to
be an auditor of a company
as provided for in Section
134(2) of Act 179

6. INTERNATIONAL STANDARDS ON
QUALITY CONTROL 1 (ISQC 1)
 LEADERSHIP
 ETHICAL REQUIREMENTS
 ACCEPTANCE AND
CONTINUANCE
 HUMAN RESOURCES
 ENGAGEMENT
PERFORMANCE
 MONITORING

7. PRACTICE
REGULATIONS
 COMPLY WITH ANTI-MONEY
LAUNDERING REGULATION ?
 COMPLY WITH BYE-LAWS?
 COMPLY WITH AUDIT
REGULATION?
 IS YOUR FIRM LICENSED & ARE
PRACTICE CERTIFICATES IN
ORDER?
 COMPLY WITH OTHER
RELEVANT LEGISLATION

8. PRACTICE
DEVELOPMENT
PEOPLE ISSUES
RECRUITING;
TRAINING
(THEORY AND
PRACTICAL);
RETENTION

9. PRACTICE
DEVELOPMENT
CLIENT
ISSUES:
ACQUISITION;
ENGAGEMENT;
DISENGAGEMENT
DISPUTES
CLIENT
RELATIONSHIP

10. PRACTICE
DEVELOPMENT
FIRM ISSUES
COSTING OF
JOBS/RECOVERY
PERCENTAGES
RISK MANAGEMENT
SUCCESSION
PLANNING

11. RISK MANAGEMENT
QUALITY CONTROL
HOT FILE REVIEWS
COLD FILE REVIEWS
ENGAGEMENT QUALITY
CONTROL REVIEWERS
ANNUAL COMPLIANCE
REVIEW (WFR & CFR)

12. RISK MANAGEMENT
 REGULATORY
COMPLIANCE
 SECURITY OF
PHYSICAL ASSETS
 FRAUD AND OTHER
BUSINESS CRIME
 IT SECURITY

13. RISK MANAGEMENT
BUSINESS CONTINUITY
BUSINESS CONTINUITY
PLANS
DISASTER RECOVERY
PLANS
PROFESSIONAL
INDEMNITY
INSURANCE (PII)

14. FULL MONITORING
REVIEW
WHOLE FIRM REVIEW (WFR)
ALL ACCOUNTANCY PRACTISING FIRMS
ENGAGEMNT LEVEL REVIEWS
(CFR)
ONLY ACCOUNTANCY PRACTISING
FIRMS CARRYING OUT AUDITS/ASSURANCE
SERVICES

15. MODULES UNDER SMP PRACTICE
MANAGEMENT GUIDE ---IFAC
PUBLICATION
Module 1: Planning for your firm
Module 2: Practice models and networks
Module 3: Building and growing your firm
Module 4: People power: Developing a
people strategy
Module 5: Technology and e-business
Module 6: Client relationship management
Module 7: Risk management
Module 8: Succession planning

16. PLANNING YOUR FIRM
(CONT’D)
Specialise or generalize? Your competitive
strategy
 Overall cost leadership
 Differentiation
 Focus

17. PLANNING YOUR FIRM
(CONT’D)
Need for business planning
 Developing a competitive strategy;
 Brief statement of mission, vision and values;
 Statement outlining the technical service deliveries;
 Human relations- people and skills required;
 More detailed plans;
 Budgets, which support components above; and
 Policies and Procedures
Effective relations with clients and employees

18. PLANNING YOUR FIRM (CONT’D)
Developing plans for your firm’s various
functions
Building a risk management mind set into your
firm
Implementing practice manuals and systems
Using benchmarks to drive performance and
improvement

19. PLANNING YOUR FIRM (CONT’D)
The business of running your firm
Find a
client
Taylor a
service
Agree
price &
terms
Engageme
nt Letter
Gather
informatio
n
Bill &
collect
Communica
te outcome
Deliver
service
Firm

20. PLANNING YOUR FIRM (CONT’D)
Monitoring external factors
Business continuity – short term
and long term imperative

21. 10 STEPS TO SUCCESSFUL RISK
MANAGEMENT
1 • STARTWITH QUALITY RECRUITMENT PROCESS
2 • ENSURE EMPLOYEES ARE PROPERLY TRAINED
3 • DO NOT DELEGATE TASKS BEYOND CAPABILITY LEVEL
4 • ENSURE EMPLOYEES ARE AWARE OF SYSTEMS AND STANDARDS
5 • IDENTIFY WEAKNESSES OR PROBLEMS WITH SYSTEMS
6 • EMPLOY PROPER REVIEW PROCESS
7 • MAINTAIN ADEQUATE SPREAD IN YOUR FEES
8 • HAVE ADEQUATE INSURANCE
9 • BACK UP YOUR RECORDS AND TECHNOLOGY
10 • BE FULLY AWARE OF PRIVACY AND CONFIDENTIALITY

22. BUILDING AND GROWING YOUR FIRM
 Developing a business
plan for your firm
 Assessing growth
requirements and
developing a growth
strategy
 Strategies for coping with
increased regulation and
competition

23. BUILDING AND GROWING YOUR FIRM
(CONT’D)
 Creating a culture for your
firm
 Identifying target clients
and new service
opportunities
 Building a brand
marketing and promotions
 Putting your plans into
operation
 Financial management

24. BUILDING AND GROWING YOUR FIRM
(CONT’D)
 Meeting the challenge of
acquiring new clients in the
current economic
environment
 Identifying additional
revenue streams that could
be developed
 Value-added services:
developing profitable
practice or service area
niches

25. BUILDING AND GROWING YOUR FIRM
(CONT’D)
 Using networks to add
value and grow profitability
 Improving the quality of
your service: what will
make you stand out and
how can you offer a better
service than your
competitors?
 Expanding through the
purchase/merger of an
accounting practice: what
are the benefits and
drawbacks?

26. DEVELOPING A
PEOPLE
STRATEGY
PEOPLE POWER

27. PEOPLE POWER – DEVELOPING A PEOPLE
STRATEGY
 Your firm and its people
Business planning and
staffing strategies need
to be linked
 Factors impacting people
management
Community
expectations
Economic changes

28. PEOPLE POWER – DEVELOPING A PEOPLE
STRATEGY (CONT’D)
 Your people
management strategy
Mix of employees
Recruitment
Induction
Clarifying
expectations

29. PEOPLE POWER – DEVELOPING A
PEOPLE STRATEGY (CONT’D)
Leading your
team
Managing and
retaining
employees
Training and
development
Tone at the top Motivation Identifying
development
needs
Communication Staff
retention
Development is
an investment
Delegation Performance
management
Remuneration
Assessing
performance

30. PEOPLE POWER – DEVELOPING A
PEOPLE STRATEGY (CONT’D)
Rewards and
recognition
Exiting/transitioning
employees
Rewards Termination
Providing recognition Exit surveys

31. CLIENT RELATIONSHIP
 Knowing your client
 Reviewing your client
base
 Measuring & exceeding
client expectations
 Benchmark service
levels
 Embracing opportunities
 Developing strategies to
provide a full range of
quality services :
mergers, networking ,
referrals
 Invoicing and collection -
-- Why clients don’t pay
 Conflict resolution &
arbitration
 Ceasing a client
relationship

32. SUCCESSION PLANNING

33. SUCCESSION PLANNING
 Develop your succession plan
 Select succession option
 Partnerships, consolidations, mergers &
acquisitions
 Sale of firm, fee parcel or progressive sell-down
 Developing internal succession plans  Valuation considerations
 Exit considerations

34. ICAEW:
QUALITY CONTROL AND AUDIT DESCIPLIN

35. ICAEW:
ETHICAL MATTERS

36. THANK YOU
COMMENTS???
QUESTIONS???
SUGGESTIONS?
??