Peer reviews' value-added experiences

By Harvey I. Milhiser, CPA
Gorfine, Schiller & Gardyn, P.A.
MACPA Peer Review Committee

I have performed approximately 350 peer reviews since 1985. The firms have been located in Maryland, Virginia, West Virginia, Pennsylvania, Delaware, Washington DC, Massachusetts, New Jersey, North Carolina, Ohio, Nebraska and California. The firms have ranged in size from one person to 70 people. The firms had from one office to four offices.

The experiences and knowledge I have gained and given during these peer reviews has been invaluable. The friends, colleagues and peers I have met and made are some of the highlights of my career. The cost of the peer reviews to my firm and the firms that I have performed the peer reviews for has been very inexpensive when compared to the knowledge gained and experiences shared. I will attempt to convey a small portion of these to you.

I have had many managing partners tell me, "We have you do our peer reviews not only to see that we are performing our engagements up to the standards of our profession, but more important, for your knowledge and experiences in the management of an accounting practice." I feel this is an area that many of the qualified peer reviewers excel. On the other hand, I get the opportunity to gain knowledge from looking at the offices, engagement files, talking to the partners and personnel, etc., of all these firms. This is a true win-win situation.

The peer reviewed firm has benefited from my firm's experiences in recruiting, obtaining, training and retaining personnel at all levels, including support staff. We discussed the merits of various CPE courses offered, both in-house and out. Also, I've told them of my firm's experience in having various staff members present a summary of the courses they attended. This procedure helped reduce the overall cost of the course while exposing the staff person to public speaking within the group. An excellent tool for training.

In addition, we've explored the new approaches to compilations, reviews and audits — an example would be the Risk Based Audits, SSARS 8, etc.; new pronouncements discussed in general, including the best manner to implement them and how to implement them; better methods to do engagements for contractors, HUD real estate projects, common interest realty associations, retail, and other areas; tips for performing more efficient and effective engagements; and engagement efficiencies.

We looked into workpapaer preparation to see if any areas needed improvement or elimination. Each firm has its own method of file management, but many times the reviewed firm was looking for a new or improved method or tweaking of its present method. The composition of the files was reviewed in light of computer schedules.

The whole area of the impact of computers on the profession was and is a fertile area of discussion. Are paperless engagements in the near future? What size firm will use them? How much of the engagement is on computer schedules? Do firms have many laptops in use in the field? Do firms use printers in the field? What programs have been successful in the trial balance, general ledger and income tax preparation areas? What is the best manner to train all staff? What programs are being used for financial statement preparation, valuation software, etc.?

Many firms have asked for information on staff evaluations — when, how to, how often, tools used, who reviews, who gets reviewed, lateral, up and down, partner reviews, when to promote to supervisor, manager or partner. This proved to be very enlightening and useful.

How to market the firm's services was a topic of a few conversations. We discussed what worked in the past, as well as what the firm was comfortable doing. Does the firm want to have internal contests for the external marketing of the firm? What is the firm considering? What are the firm's niches and/or concentrations? Who are your competitors? Nothing was ever decided in these conversations, but we opened avenues for a thought process to begin.

I am always only a telephone call away, if any firm needs to discuss any topic. Many of the firms call me one to four times a year to discuss matters ranging from technical advice to matters with a non-affected party. Many of the technical questions result in my researching the matter and obtaining knowledge that I never had before. The new knowledge gained is my payment on these areas. Well worth it to me.

The above topics represent some, if not most, of the value-added areas discussed during and after the peer reviews. I do not have overwhelming knowledge in all, or any, field, but between my years of experience and the firm's experience, we are able to very adequately address all topics. At the very least, the firm and I have gained an insight into the area that we did not have before. This provides us with the impetus to continue development of that area.

The best part of the whole peer review process is meeting colleagues and peers and making new friends. As the advertisement states, this is priceless.

For more information about becoming a reviewer, contact Claire Blevings at (800) 782-2036 or claire@macpa.org.

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