Big Four partners seek promotions for cross selling

One auditor boasted about his cross-selling and another produced his raw sales statistics while angling for a promotion, according to the latest probe into the Big Four.

Auditors are trying to capitalise on their cross-selling successes when competing for promotions, according to the Financial Reporting Council’s Audit Inspection Unit (AIU).

Authorities frown upon cross-selling, which involves an auditor selling non-audit services to their audit client. The practice is a potential threat to auditor independence and the Big Four explicitly prohibit the practice from being considered in staff appraisals.

But that didn’t stop Big Four firm Deloitte’s audit directors and managers referring to cross selling when trying to secure a promotion, according to the AIU.

“A number of audit directors and managers referred in their performance evaluations to cross selling non audit services to their audit clients,” the report stated.

In Deloitte’s Big Four rival Ernst & Young, the AIU found some staff attached their personal sales data to their appraisal forms.

“Contrary to the firm’s instructions some audit partners had retained certain raw sales data generated by the firm’s IT systems on their appraisal forms,” the report stated.

The issue was a blip on an otherwise positive report for the audit profession. Overall, the AIU found Deloitte’s strategy demonstrated the importance the firm attaches to “technical competence and high quality audit work”.

In E&Y’s case the AIU found their strategy reflected the importance the firm places on audit quality.

Read the AIU's Deloitte Report here

Read the AIU's Ernst & Young report here