Audit - Law firms turn to full audits
Law firms are moving rapidly towards adopting full audits of their businesses as they move into more complex and international markets, according to Deloitte & Touche.
The firm said the increasing use of former plc finance directors by law firms and the move to accounting for work in progress had also increased demand for full audits.
Deloittes, which dominated a survey last month of accountancy advisers to the legal profession, said the recent expansion in work for legal firms would increase further if limited liability partnerships proved popular when they become available next year.
Nigel Llewellyn, Deloittes head of professional firms’ businesses, said most law firms had used accountants to review their handling of client money. Now, he said, their affairs were becoming more complex and they were asking for full audits.
‘They are saying “we are too big to review our finances on a casual basis”,’ he said. ‘They are becoming more international, they are having to calculate for work in progress under the tax changes for partnerships and there are more plc-backgrounded FDs who are disposed to have audits.’
A survey of 50 top law firms by Legal Business magazine put Deloittes ahead of its rivals with 19 clients or 38%. More importantly, Deloittes registered half of the top 20 firms as clients.