Hi @mmff, regarding auditors they should be as independent as possible, which usually means they should only do audit work (tax work may also be done which is ok), but providing consulting beyond this needs to be disclosed and you will note that the accounts show the remuneration of the auditors.

Things to look out for is not so much changing auditors but how often. If they change every few years then it smells like they are opinion shopping for their accounts and unless this is well explained, then it's a red flag. Also if they are paid way above normal rates, then it begs a question.

Likewise and as investors in Corporate Travel Management have just found out, having the same auditor for a very long time can be a problem also. If the auditor has made a mistake they are unwilling to make adjustments and let the misstatement carry forward (or may be "too close" to management), where as a new auditor will have no such historical reputation to protect and make sure everything is reported correctly.

Listed companies have their own accountants, the CFO manages the accounts and reporting. The only reason auditors are used is to ensure an external, independent party has checked that the accounts are prepared properly, the resources and skills to prepare accounts should exist in the company.

I am an accountant & CFO, but was never an auditor - been through a lot of audits, but not for a listed company, but the process is much the same.

Good question, if your not an accountant or in finance it's an area that few understand or look into - probably because it's far to exciting for most ;)

Thanks @Tom73,

As you can probably see, I am an absolute novice in this area... appreciate your input (and expertise, & as you can gather, I have none!)

Thanks again. Easy to understand...

I absolutely cannot put into words how GOOD this site is!!!

Cheers & thanks

mmff

Hey Tom73.

Exciting!

Maybe I haven't had enough drinks!!!....

I'm just trying to keep up!

Love your work,

mmff

@mmff Tom has done a good job below, the only thing i would add is to look to see if the company is downgrading the auditor. there are tiers in auditing, the large first tier, usually reputable and expensive, to some little more than a one-man band. ok, some small firms will say they are saving money by moving from tier one auditors, but be careful, some of the disasters have been from auditors i haven't heard of before. so be familiar with the tier of auditors. if the firm moves to an author you have never heard of, operating out of West Perth, you have been warned. lol. so you can do an audit on the auditors!

Thanks @Solvetheriddle, I had thought of companies going to cheaper auditors, but hadn’t even considered there being “tiers” of them.

i will look more closely at these Notices in the future,

Cheers

mmff