The Global Pandemic Heard Around the World: The Impact on Auditing Requirements

In March 2020, COVID-19 (“Coronavirus”) impacted every industry across the globe. Generally, most businesses were prepared for the impending work-from-home mandates across the world utilizing various technologies to “remote into” servers and keep the global economy afloat. Among the most well-prepared industries for remote work was the public accounting industry due to most public accounting firms previously implementing telecommuting policies and remote fieldwork from client locations across the nation. Although our clients were prepared for telecommuting, they were not prepared for the long-term impact of COVID-19 on operations, auditing requirements, and compliance with Generally Accepted Auditing Standards in a virtual environment.

The pandemic has posed several challenges for companies and organizations related to both financial hardships and technological difficulties in learning how to interact with one another in a virtual platform. At Tronconi Segarra & Associates LLP, we were able to retain strong working relationships while working remotely on our audit engagements and communicating efficiently and effectively with clients through online webinars related to the CARES Act, SECURE Act, FFCR Act, and the newly enacted Coronavirus Response and Relief Supplemental Appropriations Act. During these times, it is imperative that organizations take a proactive approach rather than a reactive approach to cope with the long-term effects of COVID-19. The auditing profession has historically involved face-to-face interaction with clients which includes inquiries, internal control walkthroughs, and physical inventory observations which have since transitioned to a virtual landscape.

Tronconi Segarra & Associates has evaluated several different technology platforms throughout the past 10 months to determine the best course of action for remote audits that does not hinder our ability to perform an effective audit without scope limitations. During that time, we have utilized secure online video conferencing platforms and online document portals to interact with clients. Although the technology is available to do so, it has not come without its challenges. Over the past few months, we have noticed an increase in phishing emails across the nation in which hackers are attempting to remote into servers for client information and cybersecurity attacks on companies. The biggest challenge we face is how to protect our clients and their confidential information from cybersecurity risks. As such, we have been conditioned to remain vigilant and not only consider fraud risks but cybersecurity risks as our clients move to the virtual stage. As a proactive approach, our Audit & Assurance practice has started a technology committee to research and implement new technologies to improve efficiencies that not only benefit our audits but alleviate certain audit tasks for our clients as well.

To best serve our clients, we have developed new and creative ways to remain in compliance without limiting the scope of the audit. Rather than doing interviews over conference calls, we have used video conferencing for inquiries so we can not only have “face time” with clients, but we can also observe their reactions and mannerisms while responding to fraud and internal control inquiries. These types of observations are almost impossible when performing inquiry procedures over a telephone call. In addition, we can utilize certain video conferencing platforms for our internal control walkthroughs by remoting into a client’s computer to observe their internal control procedures rather than having the client update narratives and respond to lengthy questionnaires and checklists.

The audit requirement that poses the biggest difficulty during the pandemic is how auditors can perform physical inventory observations with travel restrictions to different states, sanitation concerns related to the spread of COVID-19, and clients not permitting visitors onsite due to OSHA laws. In order to conduct physical inventory observations remotely, we have utilized technology such as Zoom and FaceTime to perform observations remotely.

In the past month, Tronconi Segarra & Associates performed several remote inventory observations through secure online video conferencing platforms for our out-of-state clients. We found the process efficient and effective as clients were able to provide us with their pre-counts and interim inventory listing to make our selections and evaluate high-risk areas of inventory. In addition, we were able to obtain warehouse maps and blueprints to help guide us through the inventory count while on camera. It was extremely helpful to ensure that we made selections from all areas of the facility and to trace those counts to the client’s inventory count sheets in real-time to satisfy our audit assertions.

During the observations, we ensured that the client was able to show us different areas of the facility, requested that the client bring down pallets/bins off of high shelving, and maneuver the camera as we were counting various items to ensure accurate counts. We also inquired as to whether there was inventory such as held on consignment and obsolete or damaged inventory. During our observations, the client was able to take us to their loading dock and identify outgoing shipments that were not included in inventory at year end. Overall, the remote physical inventory observation was a simple process that allowed auditors to be present for physical inventory counts from the safety of their own offices without posing a scope limitation to the audit. In addition, the client found it beneficial as it reduced travel and audit-related expenses.

Although the Pandemic has posed several challenges across the globe, we have been successful in adapting our auditing procedures to a remote platform and will continue to adapt to the ever-changing landscape of the pandemic. Due to advanced technologies, Tronconi Segarra & Associates has been able to continue conducting effective and efficient audits while adopting new skill sets and technological innovations in what we call the “new normal” to best serve and support our clients.

For more information or questions on this topic, please contact Alexis Weber, Senior Accountant at Tronconi Segarra & Associates. She can be reached at 716.276.8588 or



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